UK Government launches holiday pay consultation

UK Government launches holiday pay consultation

The UK Government has recently launched a consultation into how holiday pay and entitlement is calculated for part-time, temporary, and zero-hour employees. Intended to explore how the process of calculating holiday pay for these groups can be simplified, the consultation also aims to provide clarity to workers on their entitlement.

The consultation follows on from the Harpur Trust v Bazel Supreme Court judgement in July 2022, which ruled that a part-time worker must have their holiday pay calculated on the same basis as a full-time employee.

Estimated to affect between 320,000 and 500,000 term-time and zero-hour workers, it proposes to introduce a holiday entitlement reference period for part-time employees and for those who work irregular hours so that their holiday pay and entitlement is directly proportionate to time spent working. The consultation also aims to understand how entitlements are currently calculated for agency workers, how the consultation proposal will be implemented, which could potentially mean amendments to leave entitlement legislation.

The Government is currently requesting responses from employers, workers, unions, business representative groups and those who represent the interests of groups in the labourers. The consultation will be open for eight weeks and will close on 9 March 2023.

Employment solicitor, Lisa Moore, said:

The Supreme Court’s decision has caused widespread confusion for many. It has also led to an element of perceived unfairness, with some part-year workers having accrued a larger holiday entitlement than part-time workers, despite them having worked the same number of hours during the year.

Whilst the Government’s consultation is only focused on annual leave entitlement (rather than holiday pay more broadly), its aim is to help simplify calculations the rectify imbalances. In order to ensure that a part-year worker’s holiday entitlement is proportionate to the number of hours they work, it has been proposed that annual leave entitlement should be calculated by the number hours worked in the previous 52 weeks by 12.07%. This in itself raises further questions such as the practicalities of how and an employer can keep an accurate record of hours worked. However, ultimately, it is hoped that this consultation is a positive move to providing more clarity on this issue and is likely to be welcomed by most.

About our expert

Simon Gilmour

Simon Gilmour

Head of Employment
Simon Gilmour is Head of Employment at Harper James. He joined the firm in April 2018 as a partner in the employment team. Having qualified as a solicitor in 1994, he has worked at top 50 law firms in the West Midlands for 25 years, 18 of which were as a partner and Head of Department.



What next?

Please leave us your details and we’ll contact you to discuss your situation and legal requirements. There’s no charge for your initial consultation, and no-obligation to instruct us. We aim to respond to all messages received within 24 hours.

Your data will only be used by Harper James Solicitors. We will never sell your data and promise to keep it secure. You can find further information in our Privacy Policy.

Our offices

A national law firm

A national law firm

Our commercial lawyers are based in or close to major cities across the UK, providing expert legal advice to clients both locally and nationally.

We mainly work remotely, so we can work with you wherever you are. But we can arrange face-to-face meeting at our offices or a location of your choosing.

Head Office

Floor 5, Cavendish House, 39-41 Waterloo Street, Birmingham, B2 5PP
Regional Spaces

Stirling House, Cambridge Innovation Park, Denny End Road, Waterbeach, Cambridge, CB25 9QE
13th Floor, Piccadilly Plaza, Manchester, M1 4BT
10 Fitzroy Square, London, W1T 5HP
Harwell Innovation Centre, 173 Curie Avenue, Harwell, Oxfordshire, OX11 0QG
1st Floor, Dearing House, 1 Young St, Sheffield, S1 4UP
White Building Studios, 1-4 Cumberland Place, Southampton, SO15 2NP
A national law firm

To access legal support from just £145 per hour arrange your no-obligation initial consultation to discuss your business requirements.

Make an enquiry