Holiday pay and entitlement reforms from 1 January 2024

8 Jan 2024

This guidance sets out the changes to the Working Time Regulations which the government introduced on 1 January 2024. Before reading this guidance, you should check the guidance on holiday entitlement. This explains how to calculate holiday entitlement and pay for the majority of workers.

The government has introduced reforms to simplify holiday entitlement and holiday pay calculations in the Working Time Regulations

These changes include:

• defining irregular hours workers and part-year workers in relation to the introduction of the holiday entitlement accrual method and rolled-up holiday pay (see section 2)
• introducing a method to calculate statutory holiday entitlement for irregular hours and part-year workers (see section 3.1)
• introducing a method to work out how much leave an irregular hour or part-year worker has accrued when they take maternity or family related leave or are off sick (see section 3.4)
• removing the Working Time (Coronavirus) (Amendment) Regulations 2020 which affect the accrual of COVID-19 carryover of leave (see section 4.1)
• maintaining the current rates of holiday pay where 4 weeks is paid at normal rate of pay and 1.6 weeks paid at basic rate of pay, whilst retaining the 2 distinct pots of leave (see section 5.1)
• defining what is considered ‘normal remuneration’ in relation to the 4 weeks of statutory annual leave (see section 5.1)
• introducing rolled-up holiday pay as an alternative method to calculate holiday pay for irregular hours workers and part-year workers (see section 5.2)

Holiday pay and entitlement reforms from 1 January 2024 - GOV.UK (www.gov.uk)