Holiday Pay & Annual Leave Compliance Check

Almost every worker in the UK is entitled to 5.6 weeks of paid statutory annual leave a year under the Working Time Regulations 1998 (28 days for someone working five days a week, including bank holidays if you count them towards the total). That applies to part-time staff, agency workers and many casual and zero-hours workers too, and the entitlement is pro-rated rather than removed. The most common mistake is not the amount of leave but the pay: holiday pay must reflect normal remuneration, which for many workers includes regular overtime, commission and certain allowances, not just basic salary.

Rules for irregular-hours and part-year workers were simplified from 2024, allowing leave to accrue at 12.07% of hours worked and, in some cases, holiday pay to be “rolled up” into hourly pay. Pay for those with variable earnings is generally averaged over a 52-week reference period. Getting this wrong creates a trail of small underpayments that can add up fast, because workers can bring unlawful deduction of wages claims covering a series of underpayments, and HMRC, ACAS and the new Fair Work Agency under the Employment Rights Act 2025 are all paying closer attention to holiday pay. This check helps you find gaps before a worker or enforcement body does.

This check looks at how you work out holiday entitlement and holiday pay across different types of worker, and flags the gaps most likely to cause underpayment claims, with practical steps to fix them.