Open Consultation on calculating holiday entitlement for part-year and irregular hours workers.

Tuesday, January 31, 2023

Following on from the Supreme Court Judgment in Harper Trust V Brazel case regarding the correct calculation of annual leave and holiday pay for employees with part time and irregular working patterns; the government are seeking views on proposals to pro-rata holiday entitlement for part-year and irregular hours workers based on the annual hours they work.

In the Harper Trust V Brazel case, the Supreme Court ruled that employees on permanent contracts who only work for part of the year, should receive the same statutory holiday entitlement as employees who work the full year. This ruling meant that the holiday entitlement of a permanent employee who works only part of the year should not be pro-rated to that of a full year worker. Part-year workers are entitled to the statutory 5.6 weeks' holiday and pay per year calculated in line with the provisions under the Working Time Regulations 1998 (WTR) using the “Calendar Week Method” and not the widely adopted 12.07% percentage method. Even though, in applying the WTR, this may result in part-year workers receiving a proportionately greater amount of leave than a full-time worker.

In this open consultation, the Department for Business, Energy & Industrial Stratergy proposes to introduce a holiday entitlement reference period for part-year and irregular hours workers, to ensure that their holiday pay and entitlement is directly proportionate to the time they spend working.

The government also hope to understand how entitlement is currently calculated for agency workers and how the consultation proposal might be implemented.

The consultation may be of interest to schools, academies, employers, workers, business representative groups, unions and those representing the interests of groups in the labour market.

You have until 9th March to respond, which can be done online or via email