Calculating part-time holidays

I am often asked by clients how to calculate holidays for part-time employees. This can be confusing and a little tricky – especially where employees work different hours on different days or do not have any fixed hours of work. There is also a lot of confusion (and often mistakes) on how the application of bank holidays works for part-time employees.

So, here is a short explanation. You may want to grab a cup of coffee, a calculator and piece of paper to work through this.

The minimum statutory holiday entitlement that is set out in statute is 5.6 weeks. This equates to 28 days, if an employee works a five- or six-day week (i.e. five days worked x 5.6 weeks).

Holidays for part-time employees should be calculated on a pro-rata basis.

Part-time workers who work the same hours each day: simply multiply the number of days they work each week (if they work the same number of hours each day) by the 5.6 working weeks to give you their annual holiday entitlement.  For example, if a part-time employee works three days per week you would multiply three days x 5.6 weeks = 16.8 (round up to the nearest half day = 17 days).

Part-time workers who work different hours on different days: I would recommend you calculate the annual holiday entitlement in hours. To do this multiply the total number of hours they work each week by the 5.6 working weeks. For example, if an employee works four hours on a Tuesday and Wednesday and five hours on a Thursday and Friday (a total of 18 hours per week) their holiday will be 18 hours x 5.6 weeks = 100.8 (rounded up = 101 hours per year). Every time they take a day off, you deduct the relevant hours for that day from their holiday entitlement.

But what about bank holidays?

Let’s assume that you do not open on a Bank Holiday. If a bank holiday falls on one of their normal working days and like the rest of the workforce they take the day off, then the bank holiday is deducted from their holiday entitlement. 

However, you would not make a deduction if the part-timers normal working day does not fall on the bank holiday.

So, let’s look at two examples:

An employee’s normal working days are Monday – Thursday working five hours per day. Their annual entitlement is therefore four days per week x 5.6 weeks = 22.5 days per year. As they work on a Monday, when there is a bank holiday on a Monday these days will be deducted from their entitlement. They will not be deducted for Good Friday as this is not one of their normal working days.

A second employee works Tuesday to Friday working five hours per day. Their annual entitlement is the same four days per week x 5.6 weeks = 22.5 days per year. Because they do not work on a Monday, when there is a bank holiday falling on a Monday this will not be deducted from their entitlement. However, Good Friday will be deducted from their entitlement.

As some bank holidays (Christmas and New Year) fall on different days each year, you will need to calculate part-time employees holiday each year (as above). 

Useful tip: It is always better to state the holiday entitlement in working weeks in the contract of employment and not in days. If for whatever reason you do state it in days and you forget to state that holidays for part-time employees are calculated on a pro-rata basis, then your part-time employee would have the right to the full 28 days or however many days you have stated in the contract (which, for example if they worked four days a week would give them seven weeks holiday!).

Angela Dansey, Practical HR