How to Calculate Pro-Rata Holiday Entitlement

Both full-time and part-time staff are entitled to a set amount of annual leave every year. However, part-time staff will not receive the full entitlement that your full-time staff receives. And what if a new employee joins your company halfway through the year? They again, won’t receive the same holiday entitlement to an employee who has been with you from the start of the year.

But how much annual leave are these employees entitled to and how do you work it out?

Thankfully, working both of these out is pretty straightforward. However, before we explain how to calculate pro-rate holiday entitlement, it’s important to understand what your legal responsibilities are as an employer.

What is the legal holiday allowance?

Almost all UK workers are legally entitled to 5.6 weeks’ paid holiday a year. For those who work five-day weeks, this equals 28 days paid annual leave each year.

Under UK law, workers have the right to get paid for leave holiday entitlement during maternity, paternity, and adoption leave. Workers also have the right to build up holiday entitlement while they’re off sick, and they have a legal right to request holiday leave at the same time as sick leave.

The law applies to agency workers, workers with irregular hours, and even workers on zero-hour contracts.

No matter what the circumstances, statutory paid holiday leave is limited to 28 days. So even employees who work six days a week will only be entitled to 28 days paid holiday.

It’s up to you whether you include bank holidays as part of this statutory annual leave. It’s also up to you whether you offer any more leave on top of the statutory 28 days. You can set your own rules for any leave you offer beyond the statutory amount. This is why many companies like to offer additional leave as an award for long service.

What about part-time staff?

Staff that works part-time may work fewer than five days a week, or they may work irregular hours. In any case, they’re still legally entitled to their 5.6 weeks’ paid holiday each year. But given that they’ll invariably work fewer hours each week than full-time staff, this 5.6 weeks’ entitlement will not necessarily extend to 28 days.

How to work out pro-rata holiday

The quickest and easiest way to work out the holiday entitlement for your part-time staff is to multiply the number of days they work each week by 5.6.

For example, if a pro-rata employee works two days a week, their statutory holiday entitlement will be 2 x 5.6, or 11.2 days.

Things get a little more complicated if your part-time staff work different hours on different days each week. You may also struggle to calculate the holiday entitlement for shift workers or term-time workers. But the main thing to remember is that people working irregular hours are entitled to paid time off for every hour they work.

We have a handy online holiday entitlement calculator to help you work out the statutory holiday entitlement for every member of staff, regardless of their hours or their shift patterns.

Employees starting or leaving partway through the year

It’s up to you to define when your “holiday year” starts and ends. Some companies make it calendrical, starting in January and ending in December. Others prefer to align their holiday year with the financial year so that it starts and ends each April.

Employees accrue holiday entitlement throughout the year. Whether you go by the calendar year or the financial year, employees will accrue 1/12 of their total entitlement each month.

For employees who join or leave part-way through the holiday year, their entitlement should be based on the amount of time they have worked for you.

For an employee starting part-way through the year, calculate their holiday entitlement from the day they join. If your holiday year starts on January 1, and they join you on April 1, their holiday entitlement will be based on the period running from April 1 to December 31. This will be 9/12 of a full year’s holiday allowance. So, if they’re a full-time member of staff and they’re entitled to 28 days’ paid leave each year, this employee who starts on April 1 will be entitled to 21 days’ paid leave.

Similarly, if an employee leaves part-way through the holiday year, their entitlement will be based on the period from your holiday year start date up to their leaving date. Again, if your holiday year starts on January 1, and an employee leaves on April 1, they’ll be entitled to 3/12 of their full year’s holiday allowance. If they’re a full-time member of staff who’s entitled to 28 days paid leave each year, an employee who leaves on April 1 will have accrued 7 days’ paid leave.

If an employee is leaving and you find that they’ve taken more than their entitled holidays, you may be able to reclaim the money in their final payslip. However, you must get this agreed upon in writing beforehand. On the other hand, if an employee’s taken less than their entitled holidays, they could move the leaving date forward, or consider offering them payment instead of the time off.

Take the stress out of calculating holiday entitlement

Paid leave and holidays are supposed to be good things. They offer a chance for employees to relax and unwind, ready to return to work after sickness refreshed and renewed.

It’s a shame that so many businesses still struggle with holiday entitlement. In some businesses, the process for requesting leave can be so complicated that many workers may end up taking less than their statutory entitlement.

An employee who never takes a break, or who takes less time off than they should, is running the risk of developing stress and anxiety.

Your employees need a break and you have a responsibility to make things as straightforward as possible.

Our absence management software makes managing holiday entitlement easy. With our integrated holiday tracker, any employee can log in from any device, instantly see how much leave they’re entitled to and how much they have to remain. And if they want to book any time off, they can make a request, and get a confirmation, in a matter of seconds.