A recent Supreme Court Judgment has answered the long-awaited
question about how the holiday pay for part-year workers should be
calculated.
A ‘part-year worker' is someone who is permanently
employed, but they only work for certain periods throughout the
year, for example, term time only workers.
Employees in the UK are legally entitled to receive 5.6 weeks of
paid annual leave under The Working Time Regulations 1998. Before
the Supreme Court clarified how annual leave should be calculated
for part-year workers, many organisations relied on the (now
re-written) Acas guidance and used the recommended
‘percentage method'. The percentage method is where an
employer takes into account the fact that 5.6 weeks in each year
will not be worked, leaving 46.4 weeks as working weeks; dividing
5.6 weeks holiday allowance by 46.4 working weeks gives 12.07%.
Many employers therefore calculated part-year workers holiday pay
as 12.07% of their hours worked.
