Holiday entitlement UK: What employers must give and how to calculate it
Learn UK holiday entitlement rules and how to calculate, so you stay compliant and plan cover confidently.
Written by Shaun Quarton—Accounting & Finance Content Writer and Growth Marketer. Read Shaun's full bio
Published Friday 10 July 2026
Table of contents
Key takeaways
- Every UK worker is legally entitled to 5.6 weeks' paid holiday per year, which equals 28 days for someone working a standard 5-day week, and bank holidays can be included within this total.
- Part-time and irregular hours workers are entitled to holiday on a pro-rata basis; from 1 April 2024, irregular hours and part-year workers accrue leave at 12.07% of actual hours worked.
- Holiday pay must reflect normal pay, including regular overtime, commission, and shift allowances, not just basic salary.
- Keeping leave requests, approvals, and payroll in one connected system reduces admin and keeps your records accurate.
What is holiday entitlement in the UK?
Holiday entitlement is the minimum amount of paid time off that UK law requires you to give your workers each year. This is a statutory right under the Working Time Regulations 1998, which means every employee and worker is entitled to it, regardless of their contract type.
Most workers in the UK are entitled to 5.6 weeks' paid holiday each year. For someone working a standard 5-day week, that works out to 28 days of holiday.
You can offer more in your employment contract, but you must at least meet this minimum.
Limits on statutory leave
This entitlement is limited to 28 days annually. This means that even you calculate a higher number, you're only legally required to provide 28 days of paid holiday.
For example, a worker on a 6-day week would calculate as 5.6 weeks × 6 days = 33.6 days, but the statutory cap means you only need to give 28 days. You can choose to offer the extra days as enhanced leave, but you're not required to.
The 28-day cap applies to the statutory entitlement only. If you've contractually agreed to more than 28 days, those additional days are a contractual right and you must honour them.
Bank holidays and your statutory entitlement
A common question is whether bank holidays sit inside or outside this 5.6-week entitlement. The answer: it's up to you.
The law doesn't require you to give bank holidays as extra paid time off. You can include the eight bank holidays in England and Wales within the 28-day statutory minimum, or you can add them on top as an enhanced benefit.
Just make sure your employment contract and holiday policy clearly state your approach so there's no confusion.
Can you offer more than the statutory minimum?
Absolutely. Many employers offer enhanced annual leave entitlement to the UK to attract and retain talent. Just remember that once you've promised extra days in a contract, they become a contractual right, and you must honour them.
Who qualifies for statutory holiday entitlement?
Almost everyone who works for you qualifies, including:
- full-time employees
- part-time employees
- workers on zero-hours contracts
- agency workers
- casual workers
The key test is whether someone has a contract to work for you directly. If they do, they're entitled to paid holiday.
How to calculate holiday entitlement for different work patterns
There are several ways to calculate holiday entitlement, and the method you use depends on whether your workers have regular hours, part-time schedules, or irregular patterns. Here's how to calculate each one.
Full-time employees
For someone working a standard 5-day week, the calculation is straightforward:
5.6 weeks × 5 days = 28 days of paid holiday per year
If your employee works 6 days a week, the entitlement is capped:
5.6 weeks × 6 days = 33.6 days, but the legal maximum is 28 days
So even if the formula gives you more than 28 days, the statutory cap applies. You can choose to give the extra days, but you're not legally required to.
Tracking in hours
Some businesses prefer to track holidays in hours rather than days, especially if workers have variable shift lengths. To convert:
5.6 weeks × average weekly hours = total holiday hours
For example, someone working 37.5 hours a week gets:
5.6 × 37.5 = 210 hours of holiday per year
This method gives you flexibility and precision, particularly for shift workers or those with changing schedules.
Part-time employees
Holiday entitlement for part-time workers must be calculated pro rata – in proportion to the hours or days they work compared to a full-time employee.
For example, if your part-timer works 3 days a week:
5.6 weeks × 3 days = 16.8 days of holiday per year
Or if they work 20 hours a week and you track holidays in hours:
5.6 weeks × 20 hours = 112 hours of holiday per year
Always apply the same 5.6-week multiplier, whether you're calculating in days or hours.
Irregular hours and part-year workers
For leave years starting on or after 1 April 2024, a new method applies to irregular-hour and part-year workers, whose holiday entitlement is calculated as 12.07% of actual hours worked in a pay period.
How accrual works
Holiday accrues at a rate of 12.07% of hours worked. This percentage comes from:
5.6 weeks ÷ 46.4 weeks (52 weeks minus 5.6 weeks) = 12.07%
So for every hour someone works, they earn 0.1207 hours of holiday.
So, for example, if a worker clocks 150 hours in a month:
150 hours × 12.07% = 18.1 hours of holiday accrued
This method, known as accrual holiday pay, ensures fairness for workers whose hours fluctuate.
Rolled-up holiday pay
Under the new rules, you're allowed to use rolled-up holiday pay for irregular-hours and part-year workers. This means you pay them their holiday entitlement with each payslip (as an additional 12.07% on top of their hourly rate) rather than paying them when they take time off.
If you use this method, you need to follow specific requirements:
- Show it clearly as a separate line on the payslip.
- Explain it in the employment contract.
- Keep records to prove you've paid it.
Rolled-up holiday pay can simplify admin, but it's only permitted for irregular-hours and part-year workers.
Starters and leavers
When someone joins or leaves mid-year, calculate their entitlement pro rata based on how much of the leave year they've worked.
Monthly accrual method
Divide the annual entitlement by 12, then multiply by the number of complete months worked.
Example: Someone entitled to 28 days works for 7 months:
(28 days ÷ 12) × 7 = 16.3 days
You can keep the decimal (16.3 days) or round up to 17 – but never round down, as this would take the worker below their statutory minimum.
Daily accrual method
Divide the annual entitlement by the total working weeks in a year (usually 52), then multiply by the weeks worked.
For example, 28 days entitlement, worked 30 weeks:
(28 days ÷ 52 weeks) × 30 weeks = 16.2 days
Paying for untaken leave on exit
If an employee leaves and hasn't used all their accrued holiday, you must pay them for the unused days in their final pay. Calculate the accrued entitlement up to their leaving date, subtract any days already taken, and pay the balance at their normal rate.
Bank holidays in the UK
There are eight bank holidays in England and Wales each year. UK law treats bank holidays as part of the 5.6 weeks of paid leave, though you can choose to offer extra paid time off for them. You have three main options:
- Include bank holidays within the 28-day statutory entitlement. For example, give 28 days total, which includes the eight bank holidays, leaving 20 days for the employee to book.
- Add bank holidays on top of statutory leave. Offer 28 days plus eight bank holidays (36 days total) as an enhanced benefit.
- Require staff to work bank holidays (with or without extra pay). This is common in retail, hospitality, and healthcare. If someone works a bank holiday, you might pay them at their normal rate, or offer premium pay or time off in lieu (TOIL) as a goodwill gesture.
Whichever approach you choose, write it clearly into your employment contract and holiday policy so everyone knows where they stand.
How to use a holiday entitlement calculator
A holiday entitlement calculator is a tool that works out how much paid leave a worker is entitled to based on their hours, days worked, and employment start date. The GOV.UK holiday entitlement calculator is the most reliable free tool available and covers full-time, part-time, irregular hours, and part-year workers.
To use the GOV.UK calculator, you'll need the following information for each worker:
- Employment type: whether they work regular days or hours, irregular hours, or part of the year only
- Days or hours worked per week: for regular workers, the number of days or hours in a standard week
- Leave year start date: the date your leave year begins
- Employment start date: if the worker joined mid-year, their actual start date so the calculator can pro-rata their entitlement
What counts as holiday pay?
Getting holiday pay UK right is just as important as calculating entitlement. The law says that workers should receive their normal pay when they take holiday – not just basic salary. This section explains what counts and how to calculate it.
Basic pay and normal remuneration
For employees with fixed hours and fixed pay, holiday pay is simple: pay them their usual weekly or daily rate. For example, if someone earns £500 a week, they get £500 for each week of holiday.
But if someone's pay varies – because of overtime, commission, or shift allowances – you need to work out their normal remuneration using a reference period.
Reference periods for variable pay
When calculating holiday pay for workers with variable hours or pay, employers must use an average from the last 52 weeks of work. To calculate the weekly average, only count weeks where the worker actually received pay – skip any unpaid weeks and keep going back until you have 52 paid weeks. You can look back no further than 104 weeks to find them.
If they've worked less than 52 weeks, use the number of weeks they've worked.
How to calculate:
- Add up the total pay (including overtime, commission, and allowances) over the last 52 working weeks
- Divide by 52 to get the weekly average
- Use this average to calculate holiday pay for each week of leave
For example, over 52 weeks, an employee earned £26,000 including regular overtime.
£26,000 ÷ 52 = £500 average weekly pay
When they take a week's holiday, pay them £500.
Overtime, commission, and allowances
If an employee regularly works overtime, earns commission, or receives shift allowances, these must be included in their holiday pay for the first 4 weeks of statutory leave. This is the part of their entitlement that comes from the Working Time Regulations.
What counts as "regular"?
The following types of payments typically qualify as regular:
- Overtime that's guaranteed or happens frequently (not one-off or occasional)
- Commission earned on a consistent basis
- Allowances for unsocial hours, shift work, or on-call duties
What about enhanced leave?
If you offer more than 5.6 weeks (for example, 30 days total), you can choose whether to include variable pay for the extra days. Many employers pay basic salary only for the additional leave, but check your contracts and policies to be sure.
Setting clear criteria
To avoid disputes, write a clear policy that explains:
- Which payments count toward holiday pay
- How you calculate averages
- What happens if someone's hours or pay change
Share this policy with your team and review it annually to keep it up to date.
Can staff carry over unused holiday?
The default rule is that statutory holiday (the 5.6 weeks) should be used within the same leave year. But there are important exceptions where carry-over is allowed – and sometimes required.
Sickness or family leave
If an employee can't take holiday because they're on long-term sick leave, maternity leave, adoption leave, or shared parental leave, they may be able to carry over unused statutory leave into the next year.
How much can they carry over?
If someone is off sick for a long period, they can build up significant carry-over. Plan ahead and encourage them to take some holiday during their phased return to work.
By agreement in contracts or policy
You can allow limited carry-over by agreement, even when there's no sickness or family leave involved. For example, you might let employees carry over up to 5 days into the next year if they couldn't take their full entitlement due to business needs. However, this is not a legal requirement.
Setting clear rules
If you offer carry-over by agreement:
- Define a cap. Limit how many days can be carried over (e.g., 5 days maximum).
- Require approval. Make it clear that carry-over isn't automatic – staff must request it and get manager approval.
- Set a deadline. Specify when carried-over leave must be used (e.g., by the end of Q1 in the new leave year).
- Ensure statutory minimum. Even with carry-over, employees must still be able to take at least 5.6 weeks in the current leave year.
Write these rules into your holiday policy and communicate them to your team at the start of each leave year.
Deadlines and recordkeeping
Good recordkeeping is essential to manage carry-over fairly and stay compliant.
Publish your leave year dates
Make sure everyone knows when your leave year starts and ends. Common options include:
- calendar year (1 January to 31 December)
- tax year (6 April to 5 April)
- anniversary of the business or employee's start date
Display the dates in your staff handbook and holiday policy.
Track approvals and balances
Use a system – whether it's payroll software, a spreadsheet, or a dedicated HR tool – to record:
- each employee's total entitlement
- how much leave they've taken
- how much is left
- any carry-over approved and the deadline to use it
Review balances monthly and send reminders if someone has a lot of unused leave. Encouraging people to take holiday evenly throughout the year reduces last-minute requests and ensures everyone gets proper rest.
Align records to payroll for audit readiness
Your holiday records should feed directly into payroll so that holiday pay is calculated accurately and you have a clear audit trail. If HM Revenue and Customs (HMRC) or an employment tribunal asks to see your records, you'll need to show:
- how you calculated each person's entitlement
- when leave was requested and approved
- how much holiday pay was paid and when
Keeping everything in one system (or tightly integrated systems) makes this much easier.
How to set up simple holiday tracking
A clear, consistent process for tracking holiday saves time, reduces errors, and keeps everyone happy. Follow these steps to build a system that works for your business.
1. Set your leave year and publish your holiday policy
Decide when your leave year starts and ends, then write a holiday policy that covers all the essential elements.
Your policy should clearly outline statutory entitlement and any enhanced leave you offer, how bank holidays are treated, the process for requesting and approving leave, notice periods for booking holiday, carry-over rules and deadlines, and how holiday pay is calculated.
Share this policy with your team in your staff handbook or intranet, and review it annually to keep it current. Having everything documented upfront prevents confusion and disputes later.
2. Choose a single place to request, approve, and record leave
Use a shared system instead of email threads or paper forms where employees can see their remaining balance, submit holiday requests, and get instant approval or feedback.
Your options include payroll software with built-in leave management, HR apps that sync with your accounting system, or spreadsheets if you have a very small team (but these don't scale well).
The key is that everyone – managers, payroll, and employees – can access the same up-to-date information. This eliminates the back-and-forth of checking availability and ensures nothing gets lost in email chains.
3. Use an hours- or days-based method consistently
Decide whether you'll track leave in days or hours, then apply that method to everyone. Tracking in hours gives you more precision for part-time and shift workers, but days can be simpler for small teams with regular schedules.
Whichever you choose, use it consistently so your records are easy to audit. Mixed systems create confusion and make it harder to spot errors or ensure compliance across your workforce.
4. Pro rata automatically for starters and leavers
Your system should calculate entitlement automatically when someone joins or leaves mid-year. This avoids manual errors and ensures you're always compliant.
For example, if someone starts in July and you use a calendar leave year, the system should give them half the annual entitlement (14 days if full-time) without you having to do the maths each time.
Automation also helps when calculating final pay for leavers, ensuring you pay the right amount for unused holiday without overpaying or underpaying.
5. Track carry-over rules
If you allow carry-over, your system should flag how many days were carried over, the deadline to use them, and send reminders as the deadline approaches. This stops carried-over leave from being forgotten and ensures employees actually take their rest.
Set up automated alerts for both managers and employees so no one loses out on leave they're entitled to, and you avoid potential legal issues around unused statutory holiday.
6. Feed approved leave to payroll
When someone books holiday, that information should flow straight into payroll so their holiday pay is calculated correctly. Integration between your leave tracker and payroll system eliminates double-entry and reduces mistakes.
This is especially important for workers with variable pay, where holiday pay calculations involve averaging overtime and commission over reference periods. Seamless data flow ensures accuracy and saves time during payroll processing.
7. Store contracts, approvals, and policy updates securely
Keep digital copies of employment contracts showing each person's entitlement, approved holiday requests, and policy documents and updates. Store these in a secure, cloud-based system so they're safe, backed up, and easy to find during audits or disputes.
Good document management protects you if there's ever a disagreement about entitlement or if HMRC requests records during an inspection.
8. Review balances monthly and nudge teams to book time off
Run a monthly report to see who has a lot of unused leave. Send gentle reminders encouraging people to book holiday evenly throughout the year. This prevents a rush at year-end and ensures your team actually rests and recharges.
Regular monitoring also helps you spot potential issues early, like employees who might lose leave if they don't use it, or departments that might be understaffed if everyone tries to take holiday at once.
Keep your team compliant with Xero
Getting holiday entitlement right is about building trust with your team and keeping your business running smoothly. When your leave tracking, payroll, and accounting are connected in one place, you spend less time on admin and more time focusing on what matters.
Xero brings your finances, payroll, and people management together so holiday calculations happen automatically and records stay accurate. Try Xero and get one month free to see how much easier managing holiday entitlement can be.
FAQs on holiday entitlement
Here are some common questions about holiday entitlement:
Do self-employed people get holiday entitlement?
No. If you're genuinely self-employed (working for yourself, not under a contract of employment), you don't have a legal right to paid holiday. However, if you're a worker (even on a casual or zero-hours contract), you do qualify for statutory leave on a pro rata basis.
Do zero-hours and agency workers get holiday entitlement?
Yes. Zero-hours and agency workers are classed as workers under UK law, so they're entitled to 5.6 weeks of paid holiday per year, calculated pro rata based on the hours they actually work. Use the accrual method (12.07% of hours worked) to calculate their entitlement where the irregular-hours or part-year worker rules apply.
Can you require employees to take holiday during shutdowns?
Yes. You can require employees to take holiday on specific dates if you give notice of at least twice the length of the holiday and set this out clearly in your holiday policy.
Does holiday accrue during maternity or adoption leave?
Yes. Employees continue to accrue statutory holiday while on maternity, adoption, or shared parental leave. They can carry over any unused leave into the next year and must be allowed to take it when they return to work.
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