Holiday Pay

Holiday Pay

31 July 2019

Working out holiday entitlement for term time only workers, casual and zero hour workers can often prove to be an administrative headache. Many employers use a 12.07% of annualised hours shortcut as set out in ACAS guidance. The Court of Appeal in The Harpur Trust v Brazel held that there is no requirement as a matter of EU law to give effect to the pro rata principle or, more particularly, to pro-rate the entitlement of part-year workers to that of full-year workers. It agreed with the EAT’s decision that when calculating holiday pay for variable hour term-time workers, employers must calculate holiday pay on the basis of the average hours worked in the preceding 12 weeks immediately before payment is made as required under the Working Time Regulations 1998. The Harper Trust has sought permission to appeal to the Supreme Court and a decision is awaited on the papers.

Please note that the reference period for calculating annual leave will be increased from 12 to 52 weeks from 6 April 2020. See below Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018, SI





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