Holiday Pay Calculator UK

Holiday pay should be simple: you take a week off, you get a week's pay. And for salaried staff on fixed hours, it is. But for the millions of UK workers whose pay varies, through shift patterns, overtime, commission, or zero-hours arrangements, working out what a week of holiday should actually pay is one of the most commonly botched calculations in payroll, and one of the most common sources of underpayment.

This calculator converts a known average weekly pay figure into estimated holiday pay for the leave you enter. If your pay varies, you may still need to calculate the correct 52-week average from your paid weeks before using the tool.

The core principle: normal pay, not basic pay

UK law requires holiday pay to reflect your normal remuneration, what you genuinely earn, not just your basic contracted rate. Years of case law have established that this includes:

• Regular overtime — guaranteed, compulsory, and even voluntary overtime if worked regularly enough to count as normal
• Commission — if commission is part of how you normally earn, holiday pay must account for it
• Regular bonuses and shift allowances — payments intrinsically linked to the work you do

The reasoning is straightforward: if holiday pay only covered basic pay, workers who rely on overtime or commission would take a pay cut every time they took leave, discouraging them from using it. If your holiday pay is calculated on basic hours alone despite you regularly earning more, you may be being underpaid.

The 52-week average

For workers whose pay varies, holiday pay is calculated using average weekly earnings over the previous 52 weeks. The rules:

• Only weeks in which you were actually paid count, unpaid weeks are skipped
• Skipped weeks are replaced by earlier paid weeks, looking back up to a maximum of 104 weeks
• If you've worked fewer than 52 weeks, the average uses however many full weeks you've worked

So if you had three unpaid weeks in the last year, the calculation reaches back three extra weeks into the past to keep the sample at 52 paid weeks.

Fixed hours and salaried workers

If your hours and pay don't vary, the calculation is simply your normal pay: a week of leave pays a normal week's wage, a day pays a normal day. The 52-week average only comes into play when pay fluctuates.

Irregular hours and part-year workers: the 12.07% method

Since holiday-year changes introduced in 2024, employers of irregular-hours and part-year workers (many zero-hours, casual, and term-time staff) can calculate holiday entitlement as it accrues, at 12.07% of hours worked in each pay period. Why 12.07%? The statutory 5.6 weeks of holiday, divided by the 46.4 working weeks that remain in the year, equals 12.07%.

These employers can also use rolled-up holiday pay: instead of paying you when you take leave, they add 12.07% on top of every payslip. If your payslip shows a separate rolled-up holiday line, your holiday pay is being paid as you go, and you won't receive extra when you actually take time off. This is lawful for irregular-hours and part-year workers, but it must be itemised separately on your payslip, quietly bundling it into your headline rate isn't compliant.

Worked example

Maya works variable shifts. Over her last 52 paid weeks she earned £19,760, an average of £380 a week. She takes one week of holiday:

• Her holiday pay for that week is £380, her average, even if her basic contracted hours would only have paid £320
• If two of those 52 weeks were unpaid, they'd be swapped for two earlier paid weeks before averaging

What to do if you think you're being underpaid

Compare your holiday payslips against your average earnings including overtime and commission. If there's a shortfall, raise it with payroll first, genuine miscalculations are common and often fixed quickly. If not resolved, Acas offers free advice, and underpaid holiday can be claimed as an unlawful deduction from wages, though strict time limits apply (generally three months from the last underpayment), so don't sit on it.

This is general guidance, not legal advice. For a specific holiday pay dispute, contact Acas or check gov.uk.