Rolled up Holiday Pay – Good News for recruiters
For leave years starting from the 1st of April 2024, businesses are now legally permitted to provide holiday pay on a ‘rolled up’ basis and should calculate leave and pay entitlement at a fixed rate. BUT ONLY FOR irregular hours or part-year workers.
Holiday pay historically should be provided when leave is taken, and advance pay added to normal payment (i.e. ‘rolled up pay’ ) was deemed illegal. Now businesses have the option to pay on a rolled up basis. This option is available, subject to these rules:
- for individuals classed as irregular hours or part-year workers – although agency workers could fall into this category this is not automatic, an assessment is required
- the amount of holiday payment should be added to normal pay and not be inclusive
- the payslip must clearly show the amount for holiday pay
- the engagement contract should reflect this arrangement
Leave payments should also be made for periods of sickness and other kinds of statutory leave, so don’t forget!
Not only should regularisation of payment over a period make life easier for recruiters but the rate of pay now allowed at a fixed 12.07% (whether payment is made rolled up or not) provides certainty. Good news for recruiters and candidates alike!
For rapid advice on this or any other employment or recruitment related topic please call Lawspeed on 01273236236.
Adrian, a highly experienced lawyer, founded Lawspeed in 1997. He is responsible for developing our extensive portfolio of products and services, including the widely used Lawspeed contract templates. Adrian is an expert on “recruitment law” and specialises in contracts, regulatory compliance, employment status and dispute handling. He is chair of the trade body the Association of Recruitment Consultancies, the only lawyer lead recruitment trade body in the UK. Adrian and his co-director Ravi devised Standards in Recruitment as a vehicle for helping drive up standards and compliance in the industry.
Adrian is our lead in discussions with the government over regulatory evolution. Apart from assisting with client support, Adrian’s primary role is research and development into methods of business delivery, our latest service Proterms being his most recent project. Adrian heads our IR35 lawyers team.
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