Every worker in the UK is entitled to paid annual leave from their first day of employment. This is a day-one right that cannot be replaced by additional pay (except when employment ends). Understanding holiday entitlement — and the rules around it — is essential for compliance.
The Statutory Minimum
- 5.6 weeks per year for all workers (including part-time and zero-hours)
- For a full-time worker on a 5-day week, this equals 28 days
- Employers can include bank holidays within the 28-day entitlement
- There is no statutory right to bank holidays off — it depends on the contract
- Part-time workers receive a pro-rata entitlement (e.g., 3 days per week = 16.8 days)
Accrual and Leave Year
Holiday accrues from the first day of employment. In the first year, employees can only take holiday they have accrued unless the employer allows advance booking. Accrual is calculated at 1/12th of the annual entitlement per month worked.
The leave year can be set by the employer (e.g., January to December, or aligned to the financial year). If not specified, it runs from the employee's start date.
Carrying Over Holiday
The rules on carrying over holiday have been clarified by recent case law:
- The basic 4 weeks (from the Working Time Directive) cannot normally be carried over unless the worker was unable to take it due to sickness or the employer prevented them
- The additional 1.6 weeks (the UK top-up) can be carried over if there is a written agreement
- Employers must actively enable employees to take their leave — a "use it or lose it" policy may not be enforceable if the employer did not encourage leave-taking
Holiday Pay
Workers must be paid their "normal remuneration" during holiday. For workers with variable pay, this is calculated based on average earnings over a 52-week reference period (excluding weeks with no earnings). This may include regular overtime, commission, and other regular payments. See our guide on calculating holiday pay.
Payment on Termination
When employment ends, the employee is entitled to payment for any accrued but untaken holiday. Conversely, if the employee has taken more holiday than they have accrued, the employer can deduct the overpayment — but only if the contract allows this.
Getting holiday entitlement right avoids costly claims. Our contracts and handbooks service ensures your holiday provisions are compliant. Get in touch.