Calculating holiday pay correctly might seem straightforward, but it’s one of the most complex aspects of payroll management. With varying employment types, fluctuating work patterns, and evolving regulations, knowing how to calculate holiday pay accurately is essential for every UK employer. Getting it wrong doesn’t just create administrative complications — it can lead to tribunal claims, financial penalties, and damaged employee relations.
This comprehensive guide breaks down exactly what you need to know to calculate holiday pay correctly for every type of worker in your organisation, helping you stay compliant while maintaining an efficient payroll process.