Your Complete Guide to Working Out Holiday Pay in the UK – No Headaches, Just Straight Talk

Hello everyone, I am your dedicated public holiday assistant. Recently, a little friend asked me about figuring out holiday pay in the UK. I know it can get confusing – what counts as a working day? Do you include overtime? What if your hours change every week? Don’t worry, I’m here to break it all down in plain, easy-to-understand language. By the end of this article, you’ll know exactly how to work out your holiday pay, whether you’re a full-timer, part-timer, or work a zero-hours contract.

So, first things first – what is holiday pay? In the UK, most workers are legally entitled to at least 5.6 weeks (28 days for someone working five days a week) of paid holiday per year. That includes public holidays if your employer counts them as part of your annual leave. The tricky bit is figuring out how much you should be paid when you take that time off. It isn’t always just your regular daily wage, especially if you earn commissions, tips, or work irregular shifts.

The basic rule from the UK government is that holiday pay should be based on what you normally earn. For workers with fixed hours and a fixed salary, that’s straightforward – you get your usual weekly or daily pay. But for people with variable hours (like shift workers, freelancers, or part-timers), you calculate an average of what you earned over the previous 52 weeks (or however many weeks you worked if fewer). That average then becomes your holiday pay rate. Easy enough, right? Well, there are a few details to watch out for.

First, only weeks where you actually worked count toward that 52-week average. So if you took unpaid time off or had a sick week, those weeks get skipped. Second, overtime, commission, and bonuses can count – but only if they’re regular and part of your normal pay. A one-off bonus for a special project might not be included. The goal is to make sure your holiday pay reflects what you’d have earned if you had been working that week.

Let’s run through a quick example. Say you’re a barista with shifts that change every week. Over the last 52 weeks, you worked 40 weeks (the other 12 you were off or on holiday). Your total earnings for those 40 weeks were £16,000. Your average weekly pay is £16,000 ÷ 40 = £400. So when you take a week’s holiday, your employer owes you £400. If you take a single day, you divide by the number of days you usually work – let’s say 5 days, so £80 per day. That’s your holiday pay.

Now, there’s also something called “rolled-up holiday pay.” This is when an employer adds a percentage (like 12.07%) to your regular paycheck instead of paying you when you actually take time off. The UK government has said this practice isn’t allowed for most workers, but it’s still used in some industries like construction or gig work. If you’re on that arrangement, you still get your paid leave – you just receive the extra money upfront. Just double-check your contract to see how it’s handled.

Another common question: what about public holidays? In the UK, if a public holiday falls on a day you normally work, your employer can ask you to take it as part of your annual leave, or they might give you the day off with pay. If you don’t usually work on that day (say you’re off on Mondays and a public holiday is on Monday), you’re not entitled to an extra day off. Your statutory 5.6 weeks already includes the eight public holidays in England and Wales.

Questions Related to Working Out Holiday Pay in the UK

What if I’m a part-time worker? Do I still get 5.6 weeks?
Yes, but the number of days you get is prorated. If you work three days a week, your statutory holiday is 3 days × 5.6 = 16.8 days. You can round that up to 17 for convenience. The same calculation method applies – your pay is based on your average weekly earnings from those three-day weeks.

Does sick leave affect my holiday pay calculation?
Not directly. If you were on sick leave, those weeks don’t count as “worked weeks” for the 52-week average. But your employer can’t use a period when you were on sick leave to lower your average unfairly. They should use the weeks you actually worked to get a fair picture.

What about zero-hours contracts?
You still have the same statutory holiday entitlement, but it’s calculated based on hours worked. Many zero-hours workers use the “accrual method” – you earn holiday pay at 12.07% of the hours you work. For example, if you work 20 hours in a week, you accrue about 2.41 hours of holiday pay. When you take holiday, you get paid based on that accrued amount. Some employers still use the 52-week average for zero-hours staff, which is also legal as long as it’s fair.

Can my employer include public holidays in my 5.6 weeks?
Yes, they can. Most employers give you the bank holidays as part of your entitlement. So if you get 28 days total, and there are 8 bank holidays, you have 20 other days to choose. But if your contract says “plus bank holidays,” then you get those on top of the 28 days.

Do I get paid for overtime when I’m on holiday?
Only if that overtime is regular and guaranteed. If you always work extra hours every week, that should be reflected in your average pay. But irregular, voluntary overtime may not count. The key word is “normally” – what would you have earned if you were working that week? If overtime is part of your normal routine, include it.

What happens if my employer underpays my holiday?
That’s a big no-no. If you think you’ve been underpaid, start by talking to your employer or HR. You can also contact Acas – the Advisory, Conciliation and Arbitration Service – for free advice. If the issue isn’t resolved, you can take it to an employment tribunal. Keep records of your pay slips and hours worked to build a case.

One more thing – the rules changed in 2020 for irregular hours workers. A new law says you must calculate holiday pay using a 52-week reference period (previously it was 12 weeks). That change was meant to make the calculation fairer, especially for people with seasonal or fluctuating earnings. So if you’re a teacher covering term-time only or a delivery driver with seasonal peaks, that longer average helps stabilize your holiday pay.

To sum it up: knowing how to work out your holiday pay in the UK comes down to understanding your normal earnings and the 52-week average rule. Keep track of your hours and earnings, and always check your contract. If you work irregular hours, use the 12.07% accrual method or the average from the last 52 worked weeks – whichever your employer uses. And don’t be afraid to ask questions. Holiday pay is a legal right, not a favor.

public holiday calendar.COM Thank you for reading, I hope this article can help you fully understand how to work out holiday pay in the UK. If you have more questions – like about specific industries, partial weeks, or what to do if your employer refuses to pay – just drop me a line. I’m your Holiday Little Assistant, here to make sure you get your well-earned time off without the stress. Cheers!