• Minhaz Moosa

Is your business ready for changes in Holiday Pay?

In accordance with the UK Working Time Regulations, employees are entitled to a minimum of 5.6 weeks (28 days) paid leave each year.

This considers 1.6 weeks (8 days) worth of Bank Holidays, where employees still receive their standard rate of pay (unless specified otherwise, e.g. double pay for hours worked on a Bank Holiday, or Bank Holidays are considered normal working days in your profession).

However, be aware that Holiday Pay legislation is changing drastically on 6th of April 2020, creating added pressure for businesses to remain compliant and correct.

How is Holiday Pay changing?

The changes to legislation will require you to include every aspect of an employee’s pay in their Holiday Pay calculation.

This will include commission, additional payments and non-voluntary/voluntary overtime that are usually paid each month.

To quantify this change, if an employee earns an average of £300 commission each month, this would be included in their Holiday Pay.

But if an employee receives an annual bonus, you wouldn’t factor this in when making calculations.

This upcoming change will make accurately calculating Holiday Pay considerably more complex, as employers now have to factor in significantly more information.

Intelligent Payroll Holiday Pay Module

We also offer a Holiday Pay Module that supports organisations with the changing legislation.

Intelligent Payroll's Holiday Pay Module offers a flexible solution for automatically configuring Holiday Pay, ensuring you never have to do a manual calculation again.

For more information on how our Holiday Pay Module can support you, click here.

Any questions?

If you’re unsure as to whether the changes to Holiday Pay will impact your organisation don’t worry. Click here and contact us today.

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