Working Time Regulations: Holiday pay and entitlements

On 1 January 2024, the Department for Business and Trade issued guidance on reforms to holiday pay and entitlement following changes to the Working Time Regulations. 

These changes include:
  • defining irregular hours workers and part-year workers in relation to the introduction of the holiday entitlement accrual method and rolled-up holiday pay 
  • introducing a method to calculate statutory holiday entitlement for irregular hours and part-year workers 
  • introducing a method to work out how much leave an irregular hour or part-year worker has accrued when they take maternity or family related leave or are off sick
  • removing the Working Time (Coronavirus) (Amendment) Regulations 2020 which affect the accrual of Covid-19 carry over of leave 
  • maintaining the current rates of holiday pay where four weeks is paid at normal rate of pay and 1.6 weeks paid at basic rate of pay, whilst retaining the two distinct pots of leave 
  • defining what is considered ‘normal remuneration’ in relation to the four weeks of statutory annual leave 
  • introducing rolled-up holiday pay as an alternative method to calculate holiday pay for irregular hours workers and part-year workers 
You should ensure your HR teams or providers are aware of these changes. Please be aware that the guidance is not intended to be relied upon in any specific context or as a substitute for seeking advice (legal or otherwise) on a specific circumstance, as each case may be different. In addition, if employers introduce changes to terms and conditions, they must seek to reach agreement with their workers or their representatives.

More information is available here.

 

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