New 52-week holiday pay reference period

Twelve to 52

The twelve-week holiday pay reference period is used to determine a worker’s average weekly pay for holiday purposes.

However, the government has identified that a twelve-week reference period doesn’t benefit those who work irregular and fluctuating weekly hours.

It has therefore decided to increase the reference period from twelve to 52 weeks via the Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 which will come into force on 6 April 2020.

This change means that holiday pay will need to be calculated on average hours worked over an entire year, not the just twelve weeks immediately preceding the worker’s holiday.