Acas guidance on calculating holiday pay

13 January 2015

Acas has updated their holiday pay guidance to reflect recent court judgements and the resulting change to regulations.

The Government has introduced regulations to take effect from 1 July 2015 to limit and clarify the maximum amount of back-dated holiday pay that can be claimed.

This means that the rules employers and workers follow to calculate holiday pay may need to be updated.

Key points:

  • Guaranteed and normal non-guaranteed overtime should be considered when calculating a worker's statutory holiday pay entitlement but there is currently no definitive case law that suggests voluntary overtime needs to be taken into account.
  • Commission should be factored into statutory holiday pay calculations.
  • Work-related travel may need to be factored into statutory holiday pay calculations.
  • A worker's entitlement to holiday pay will continue to accrue during sick leave.
  • There are different rules for calculating holiday pay depending on the working patterns involved.
  • Workers must take their statutory paid annual leave allowance and can only be 'paid in lieu' for this when their employment ends.

CIPP comment

The CIPP are running a new training course on holiday pay and leave which will give members up-to-date detail on recent changes.