UK Holiday Pay 2026 — 5.6 Weeks, 12.07%, Rolled-Up Pay, Overtime

Reviewed by Alex Morgan · Updated April 2026 · Post-2024 reform regime in force

Statutory entitlement at a glance

Many professional UK employers offer 5.6 weeks plus bank holidays — typically 25 + 8 = 33 days, or 28 + 8 = 36 days. This is contractual generosity above the statutory floor. Always check your contract — the difference between "28 days inclusive of bank holidays" and "28 days plus bank holidays" is 8 days a year.

The 12.07% calculation explained

The 12.07% figure is the proportion of the working year that the 5.6 weeks of statutory holiday represents:

Worked example: a casual cafe worker does 30 hours in week 1, 18 hours in week 2, 25 hours in week 3. Holiday accrued: (30 + 18 + 25) × 12.07% = 73 × 0.1207 = 8.81 hours of paid leave accrued across those three weeks. When they take leave, they're paid at their average rate over the previous 52 weeks (skipping any weeks with zero hours, up to 104 weeks back).

Rolled-up holiday pay — back in fashion (for some)

Rolled-up holiday pay (RUHP) is paying the holiday pay element on top of each pay packet rather than paying separately when leave is actually taken. The European Court of Justice ruled it unlawful in 2006 (Robinson-Steele) — but the Government re-introduced it for specific worker categories from 1 April 2024. Current rules:

• Permitted for: irregular-hours workers (no fixed minimum hours guaranteed) and part-year workers (only work part of the year, even if regular hours during work periods, e.g. term-time-only).
• Not permitted for: regular full-time or part-time employees — they must be paid for leave at the time it's taken.
• Calculation: at least 12.07% on top of every basic-pay payment, including any overtime/commission components.
• Contract must say so: written agreement specifying RUHP is in operation and the percentage applied.
• Workers must still take leave — RUHP doesn't buy out the right to actually take time off.
• Payslip transparency: the holiday-pay element should appear separately on the payslip so it's verifiable.

The 2024 reform reversed the awkward post-Harpur-Trust period (2022-2024) when employers couldn't legally use 12.07% for irregular workers and had to use the cumbersome 52-week reference. Most major umbrella companies, agencies and seasonal employers now use RUHP again for casual workers.

What counts as "normal remuneration" — Bear Scotland and beyond

Holiday pay isn't just basic salary — it must reflect what the worker would earn if working. The case law sequence (Williams v BA, Lock v British Gas, Bear Scotland v Fulton, then statutory reform) settled what must be included:

• Regular overtime — guaranteed AND non-guaranteed AND regular voluntary, if performed sufficiently regularly to be considered normal pay.
• Commission — sales commission, performance bonuses paid in normal pay cycle.
• Shift premia — additional payments for unsocial hours, weekends, nights.
• Travel-time allowances — if regularly paid as part of the employee's normal pay.
• Length-of-service allowances — payments tied to the employee's status.
• Standby payments — if regular and intrinsic to the work pattern.

What does NOT need to be included: truly one-off bonuses, exceptional ex-gratia payments, payments for genuinely ad-hoc tasks outside the normal pattern. The test is "intrinsically linked to the performance of the contractual duties."

Important nuance: this duty to include normal remuneration applies only to the 4 weeks of EU-derived holiday. The additional 1.6 weeks of UK statutory leave can technically be paid at base rate only. In practice most employers pay all 5.6 weeks at the same enhanced rate to avoid payroll complexity.

The 52-week reference period for variable pay

For workers with variable pay (commission, overtime, shift premia, irregular hours), holiday pay is calculated using an average over the previous 52 paid weeks — extended from 12 weeks in April 2020. Rules:

• Look back at the 52 weeks before the leave starts.
• Skip any weeks with zero pay (e.g. unpaid leave, sickness without pay).
• If fewer than 52 paid weeks are available, use however many paid weeks you have, going up to 104 weeks back.
• Average weekly pay = total pay ÷ paid weeks counted.
• Apply that average to the holiday week being paid.

The 52-week extension was designed to smooth out seasonal pay fluctuations — for retail or hospitality workers, the 12-week window meant Christmas-period leave was massively over-paid (Dec averaging) while January leave was under-paid. The 52-week window evens this out.

Carry-over rules

Holiday on termination — payment in lieu

Untaken statutory holiday at termination must be paid as a "payment in lieu of accrued leave" (PILON for holiday). Calculation:

1. Calculate proportion of leave year worked (e.g. left 31 July of a calendar-year leave year = 7/12).
2. Annual entitlement × proportion = total accrued.
3. Total accrued − leave already taken = days to pay in lieu.
4. Days × daily rate = payment.

Working time regulations also allow employers to require the employee to take their accrued but untaken leave during the notice period in lieu of cash — common practice in the UK during garden leave. The reverse (employer requires employee to forfeit accrued leave) is unlawful.

If holiday pay is wrong — your remedies

• Internal grievance — raise with HR/payroll first; many cases are pure arithmetic errors.
• HMRC complaint — for systematic NMW underpayment cases involving holiday pay.
• Employment tribunal — unauthorised deduction from wages claim within 3 months of the underpayment. Backdated claims now limited to 2 years (since 2015 Deduction from Wages Limitation Regulations).
• Constructive dismissal — sustained holiday-pay underpayment can be a fundamental breach allowing resignation with claim.

Pair this with

• → UK National Living Wage 2026 — minimum hourly rate floor
• → UK Statutory Sick Pay 2026 — companion paid-leave right
• → UK Day-1 Unfair Dismissal 2026
• → UK Employment Rights — full statutory floor
• → UK workplace issue playbooks — 15 scenarios
• → UK Take-Home Pay Calculator

Sources

1. gov.uk — Holiday entitlement
2. gov.uk — Holiday entitlement calculator
3. BEIS — April 2024 holiday pay reform
4. Working Time Regulations 1998
5. Acas — Holiday entitlement guidance