2024 Holiday pay reforms: a guide for fire & security employees

Apr 28, 2024

As of January 1st, 2024, significant reforms have been introduced in the UK regarding holiday pay entitlements, aiming to ensure that workers are not financially disadvantaged when taking time off. It’s crucial for all employees to understand these changes to ensure you’re receiving the correct pay for your annual leave.

What is Holiday Pay?

Holiday pay is based on the legal principle that you should not suffer financially for taking a holiday. The amount of pay you receive for your holiday leave depends on the number of hours you normally work and how you are paid for those hours. Starting January 1, 2024, a new definition specifies what must be included when calculating your ‘normal’ rate of pay.

What Must Be Included in Your Normal Holiday Pay?

The following payments must now be included in your normal holiday pay:

  • Commission Payments: Payments linked to the performance of tasks which you are contractually obliged to carry out.
  • Status-Related Payments: Payments relating to your professional or personal status, such as length of service, seniority, or professional qualifications.
  • Overtime Payments: Regularly paid overtime in the 52 weeks preceding the calculation date.

This means your employer must include commissions, bonuses, and overtime when calculating your holiday pay. They must pay you an additional sum equivalent to the average of any additional pay you received in the preceding 52 weeks. Failure to include these payments could result in underpayment of holiday pay.

How to Ensure You’re Getting the Right Holiday Pay

Calculate Additional Holiday Pay:

  • Add up all commissions, bonuses, and overtime you’ve earned in the 52 weeks before your holiday.
  • Divide this total by 52 to get an average weekly amount.

Use Government Tools:

  • The Government provides a handy tool to help work out holiday entitlement. Make sure to use it to understand your pay better.

What You Need to Know

Maintain Detailed Records:

  • Keep track of all payments, including commissions, overtime, bonuses, and other allowances. This ensures your holiday pay is accurately calculated and can help resolve any disputes or queries.

Understand Your Rights:

  • Clear communication from your employer is essential. Ensure you are informed about how your holiday pay will be calculated under the new system and ask questions if anything is unclear.

Stay Informed:

  • Employment law is always evolving. Regularly check reliable sources of information, such as the Gov.uk website to stay updated on any changes that might affect your holiday pay.

In Summary

The 2024 holiday pay reforms in the UK have brought significant changes. By understanding these reforms, keeping accurate records, communicating effectively with your employer, and staying informed about your rights, you can ensure you receive the correct holiday pay. Make sure you’re fully aware of how these changes impact you to maintain your financial well-being when taking your well-deserved time off.