Holiday accrual for irregular hours and part year workers including rolled up holiday pay

Workers continue to accrue statutory annual leave during any period of statutory maternity leave in the same way as if they had been at work. Your employer will therefore have to calculate how much leave you have accrued while on maternity leave.

For holiday years starting on or after 1st April 2024, if you are a part year or irregular hour worker then your employer should calculate how much holiday you have accrued based on the average hours that you worked per week over the 52 weeks (the relevant period) preceding the start of your maternity leave. When calculating the average hours worked weekly, your employer should not include weeks where you were on maternity or family related leave or off sick for any period of time. However, any weeks you did not work for any other reason should be included. If you have not worked for your employer for 52 weeks, the relevant period is shortened to the number of weeks you have worked for your employer. The average number of hours per week is worked out by dividing the total number of hours worked over the 52 week period by 46.4 (this is the total number of potential weeks you could have worked, ie 52 weeks minus 5.6 weeks of annual leave). This figure is then used to work out the number of hours of annual leave accrued by dividing it (the average number of hours per week) by 100 and then multiplying by 12.07. This figure can then be multiplied by the number of weeks you were on maternity leave in order to get the total number of hours of annual leave accrued while on maternity of other family related leave.

The government has produced guidance on how to calculate holiday and holiday pay entitlement which contains helpful example holiday pay calculations covering different scenarios including part year/irregular hours workers during maternity leave as well as rolled up holiday pay.

By law, if a worker is unable to take their annual leave due to being on maternity leave, the employer is required to allow them to carry it over into the following leave year.

There are three ways in which your employer might choose to manage this issue:

1. Pay in lieu.  Your employer could choose to pay you in lieu of the holiday entitlement that you have accrued during your maternity leave, upon your return to work.  (Payment in lieu means simply payment “in place of/instead of” something else, in this case, the annual leave). If you have taken maternity leave then your employer should use the method for calculating your holiday accrual during your maternity leave based on the method above and would need to pay you for the relevant amount of accrued holiday . 
   
2. Requiring the accrued leave to be added onto the end of your maternity leave.  Your employer could choose to tell you that you must take the period of holiday entitlement which you have accrued during your maternity leave immediately following the end of your maternity leave period (thereby delaying the date of your return to work until after the period of annual leave).
   
3. Allowing the accrued leave to be taken at another time and paying you the correct amount for it. Your employer could choose to tell you to take the accrued leave at some other time following your return from maternity leave (or could agree your request to take the accrued leave at some other time following your return) and pay you the correct holiday pay which is due to you at the time the leave is taken.

If your employer refuses to let you take your accrued holiday (and hasn’t paid you in lieu of your entitlement), then you should discuss this with your employer in the first instance.

You could also share this Working Families guidance with them.

You build up holiday as normal while you are on maternity leave, and your employer should recognise this. It is a well known principle of UK employment law.

If you can’t take your holiday because you’re on maternity leave, your employer should let you carry over up to 5.6 weeks of unused days (pro rata – this is the equivalent of 28 days if you work 5 days a week) into your next holiday year. This principle has recently been confirmed by the holiday pay and entitlement reforms which came into force on 1 January 2024.

Your employer should allow you to take your accrued holiday when returning from maternity. This could be straight after your maternity leave or at another time in the year or you could spread out your accrued holiday over the course of the holiday year, however you are entitled to use your accrued holiday.

Alternatively, some employers operate rolled-up holiday pay and if your employer does this they may choose to make a payment in lieu of your accrued holiday pay to you instead of allowing you to take the leave. (As noted above, this practice is unlawful, but some employers still operate it and if you have received payment in lieu it is unlikely to be worthwhile challenging that.

If the discussions with your employer don’t resolve the issue, or you think your employer has treated you very unfairly, and the relationship is at risk or is breaking down, you can consider raising a grievance.

Raising a grievance is important if you think you might later raise a claim in the Employment Tribunal because failure to follow internal resolution methods can disadvantage your claim.

It is often advisable to try and resolve things amicably, as formal processes can damage your relationship with your employer. For legal insight into grievances and tips on how to engage with your employer before it reaches this point, see our article on how grievances do more harm than good.

If your employer still does not recognise your right to take your accrued holiday (and has not paid you in lieu) despite you having raised this informally and/or as a grievance, then you can consider a claim against your employer in the employment tribunal.

If you want to submit an Employment Tribunal claim, there is a strict time limitation to do so – you must bring a claim within three months less a day of the date your change occurred (for breach of contract), the date of your dismissal (for unfair dismissal), or the date of the acts complained of (for discrimination).

In order to start the process of making a claim, you must first contact ACAS to start early conciliation. For further details of the process for bringing an Employment Tribunal claim please see our articles on starting a claim.

The process can be complex, so we strongly recommend seeking legal advice if you choose to do this.

You may have the following potential claims:

• A claim for unpaid or underpaid holiday pay under Regulations 16 and 30 of the Working Time Regulations 1998 – This is relevant where you have taken your accrued holiday but your employer did not pay you for it.  You could also claim unlawful deduction from wages.
• A claim that your employer has refused to let you take your accrued statutory leave under Regulations 13, 13A and 30 of the Working Time Regulations 1998 – This is relevant where you have been unable to take the holiday you have accrued during maternity leave because your employer refuses to recognise it;
• A claim for Sex Discrimination – If your employer has not recognised your right to accrue holiday during your maternity leave then you may have a claim for indirect sex discrimination.