Annual leave for irregular hours

Annual leave for irregular hours and part-year workers

On the 1st of April, new rules came into effect for irregular hours and part-year workers, which has amended sections of The Working Time Regulations (WTR) 1998.

The changes have attempted to provide further clarification on the definitions of Irregular Hour and Part-Year workers:

• Irregular Hours: A worker whose number of paid hours worked in each pay period is, under the terms of their contract, wholly or mostly variable. This therefore includes zero hours, but not those whose hours are fixed but with an irregular working pattern (e.g., shift workers).
• Part-Year: A worker who is required to only work for part of the year, with periods of at least a week where they are not required to work and are not paid during that time. This includes term-time, many school workers and seasonal workers, but would not include term-time-only workers who are paid on an annualised salary.

There are also changes to holiday entitlement and holiday pay for the aforementioned workers:

Holiday entitlement

Irregular hours and part-year workers will no longer receive the full 5.6 weeks’ entitlement at the start of the holiday year.

Instead, the new regulations allow hours to be accrued on the last day of each pay period at the rate of 12.07% of the number of hours worked in that period.

In instances where the worker should be working but takes sick or family-related leave, a week’s pay should be calculated using the 52 week average pay rule.

This doesn’t apply to weeks where the worker wasn’t scheduled to work.

Holiday pay

Employers will be legally allowed to roll up holiday pay for irregular hours and part-year workers.

Rolled up holiday pay is calculated as 12.07% of all remuneration earned in that pay period and would be issued alongside worker’s pay.

It must therefore be clearly itemised on the worker’s payslip.

However, employers are still obligated to ensure that workers are taking their designated leave entitlement in the holiday year.

Please note: These changes occur for holiday years starting 1st April 2024.

If your holiday year is 1st January then the changes don’t come into effect until January 2025.

There are still areas that require further clarification.

However, in the meantime, you can find further guidance from the Government on the upcoming holiday reforms by clicking Holiday pay and entitlement reforms.