Changes to how your rate of holiday pay is calculated

From 6 April 2020, there will be important changes to how holiday pay is calculated for those without fixed hours or fixed pay.

Fri 3rd April 2020 The PDA

The PDA is making pharmacists aware of a change in the law concerning how rates of holiday pay are calculated and what this means for them

From 6 April 2020, there will be important changes to how holiday pay is calculated for those without fixed hours or fixed pay.

Legally, all employees are entitled to 5.6 weeks of holiday leave every year i.e. 28 days per annum for those employed for 5 days per week (pro-rata for part-time employees). This entitlement can include bank holidays.

Until now, those with working hours that varied have had their leave calculated by using a 12 week reference period. The average pay from the employee’s last 12 weeks of earnings (discounting other leave, statutory payments, or period where no earnings are received) is then used to calculate the pay that they receive for their leave.

From 6 April the reference period for calculating holiday pay for variable hours workers will increase from 12 to 52 weeks. The calculation includes the 52 weeks that the employee has worked and received pay, importantly, those weeks without pay are not be counted towards the 52 week average.

In situations where employees have worked for less than 52 weeks, employers should use as many full weeks of work as possible to calculate holiday pay. Furthermore, contractual overtime worked during the reference period must also be included in holiday pay.

Many pharmacists are likely to have increased their hours during the COVID-19 crisis. It is therefore likely that your holiday pay will be proportionately increased as a consequence. Every paid hour you now work will increase the level of pay you receive when you eventually take holiday during the following 52 weeks. Your employer should know about this, but you should make sure that you are paid correctly, so that you can take what will be very well deserved periods of rest and recuperation.

The Pharmacists' Defence Association is a company limited by guarantee. Registered in England; Company No 4746656.

The Pharmacists' Defence Association is an appointed representative in respect of insurance mediation activities only of
The Pharmacy Insurance Agency Limited which is registered in England and Wales under company number 2591975
and is authorised and regulated by the Financial Conduct Authority (Register No 307063)

The PDA Union is recognised by the Certification Officer as an independent trade union.

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