By Anna Jordan on Small Business – Advice and Ideas for UK Small Businesses and SMEs
People on zero hours contracts are entitled to holiday and holiday pay, just like your regular staff.
In this quick guide, we’ll explain how to do it.
How do I calculate holiday entitlement?
Zero-hour contract employees, like any employee, are entitled to 5.6 weeks of paid holiday per year. This can include bank holidays if you wish. The rules around holiday entitlement are fairly loose, as long as you meet the 5.6 week minimum.
>See also: Zero hours contract rights
A popular method is the 12.07 per cent calculation. This is arrived at using the calculation of5.6 (weeks of paid leave) divided by 46.4 (remaining weeks in the year). So, holiday is accrued at a rate of 12.07 per cent per hour.
If a worker on a casual contract works ten hours in a week, then they would have accrued 1.2 hours holiday. (12.07 per cent of ten). If the employee worked 30 hours, they would accrue 3.6 hours of holiday for that week. (12.07 per cent of 30).
To calculate average hourly pay rate, only the hours worked and how much was paid for them should be counted. Take the