Accrued Holiday Pay on Leaving

[NettyNut]

Hello - new to this . I would be grateful re some advice on the calulation of holiday pay owed when leaving. How should a daily/hourly rate be calculated? Many thanks

[ostell]

https://www.gov.uk/calculate-your-holiday-entitlement then subtract what you gave taken

[ULA]

Hi and welcome.

Sorry just need to ask some questions to help you out:

What type of contract are you on, full time, part-time or zero hours contract?
Is your salary paid monthly based on an annual salary divided by 12 or are you paid hourly based in the number of hours you work or some other basis?
What is your annual holiday entitlement?
Does this include bank holiday or not?

Thanks

[NettyNut]

Hi and welcome.

Sorry just need to ask some questions to help you out:

What type of contract are you on, full time, part-time or zero hours contract?
Is your salary paid monthly based on an annual salary divided by 12 or are you paid hourly based in the number of hours you work or some other basis?
What is your annual holiday entitlement?
Does this include bank holiday or not?

Thanks

I am not sure how much detail I can put on here but I worked for a large organisation and would like to think they have the legal side tied up but I cannot accept their final calculation for accrued holiday pay. Including holiday accrued and allowances I agreed I was owed 269.8 hrs holiday and 7.9 hours flexi hrs. The calculation given for the hol pay accrued is the only one i am not happy with and was told by a third party who were contracted to pay these amounts and use the formula

Annual leave hours – 269.8
Flex hours – 7 hours & 55 minutes.

Firstly, in order to calculate annual leave hours are converted into days.
As per policy 269.8 hours convert to 36.46 days based on 7.4 hours in 1 working day.

The calculation is as follows:
FTE annual salary + allowances / 12 / days in month of leaving x days owed.
£27565.00 / 12 / 30 x 36.46 = £2791.72

I was on an Annual Salary working 32 hrs per week over 4 days. A Full Time Contract was for 42hrs with one hour paid break hence 37 working hours for FT. My 32 hrs did not require me to take a lunch break.

Hope this makes sense. Thanks

[NettyNut]

https://www.gov.uk/calculate-your-holiday-entitlement then subtract what you gave taken

Thanks for prompt reply. I have exhausted the Govt Guidelines . I am questioning the final calculation used to calculate monies owed. I accept what was owed in terms of hours was converted in to Full Time equivalent days........it is this final calculation over 30 days that confuses me??

Firstly, in order to calculate annual leave hours are converted into days.
As per policy 269.8 hours convert to 36.46 days based on 7.4 hours in 1 working day.

The calculation is as follows:
FTE annual salary + allowances / 12 / days in month of leaving x days owed.
£27565.00 / 12 / 30 x 36.46 = £2791.72
The above is the amount shown on payslip, paid on 31-October-2020.
The Exit team have recalculated the above and I confirm the correct amount has been paid to you.

[ULA]

Sorry I am very confused as to how you can accrue 36.46 days holiday given that the statutory entitlement is 28 days and would be pro-rata for part time staff.

What are the allowances that you mention?

Does your company also provide holiday entitlement more than the statutory minimum holiday entitlement, in which case your accrued holiday on termination should be calculated in accordance with your contract. Have you checked to see if the calculation is as per your contract.

Not sure how you get 7.4 working hours in a day as if you work 32 hours over 4 days that is 8 hours a day if you do not get a break (this is illegal by the way as once you have worked over 6 hours you are legally required to have a 20 minute break).

All of that aside to calculate a day rate based on your part-time working, I would use the following calculation:

Your annual salary based on your 4 days a week / weeks in the year i.e 52/ number of days you work in the week i.e 4 which gives your day rate of pay then x 36.46 the number of accrued days holiday entitlement you have agreed you are owed.

[NettyNut]

Thanks for prompt reply. I have exhausted the Govt Guidelines . I am questioning the final calculation used to calculate monies owed. I accept what was owed in terms of hours was converted in to Full Time equivalent days........it is this final calculation over 30 days that confuses me??

Firstly, in order to calculate annual leave hours are converted into days.
As per policy 269.8 hours convert to 36.46 days based on 7.4 hours in 1 working day.

The calculation is as follows:
FTE annual salary + allowances / 12 / days in month of leaving x days owed.
£27565.00 / 12 / 30 x 36.46 = £2791.72
The above is the amount shown on payslip, paid on 31-October-2020.
The Exit team have recalculated the above and I confirm the correct amount has been paid to you.

Thank you for your comprehensive response. I shall explain in more detail re my contract later today - I will need more time but just wanted to thank you in the interim for your quick reply. Thank you

[NettyNut]

Thank you for your comprehensive response. I shall explain in more detail re my contract later today - I will need more time but just wanted to thank you in the interim for your quick reply. Thank you

[NettyNut]

Apologies if I have not been clear enough. When I first joined my employment 27 years ago I was on a full time contract which included a monthly paid salary and the working week was 42 hrs over 5 days including one hour each day for lunch hence 37 hrs worked. The Annual Leave was 22 days per year rising to 30 days after 25 years service.

Within my 27 years there I became part time working 32 hrs a week with my salary being 32/37 as part time staff did not require to take a lunch break though I did benefit from two 15 min paid breaks each day. The 7.4 hrs for a full time employee is arrived at by 37hrs/5days.

My contracted stated that my 32 hrs per week would have the exact hours agreed by my line manager - It was agreed that i work Mon to Thurs 8 hrs each day with the added agreement of flexible working hours. This remained the case for over 20 years

On leaving I had accrued 36.46 Full Time Equivalent holidays. This was because I had taken no leave through the year and due to personal circumstance I was allowed to carry forward two weeks leave pro rata from the previous year. Additionally there were a few bank holidays I was owed in lieu.

Any time during the year that over time was worked on a Sat or Sun it was paid at basic rate plus a premium but was not part of a normal working week so I fail to understand how the final calculation of days owed is spread over 30 days.....This is the calculation given
FTE annual salary + allowances / 12 / days in month of leaving x days owed.

I hope I have given you a little more information this time.

Many thanks

[ULA]

Thank you for the detailed explanation which has made your query much easier to understand and verifies the amount of accrued but untaken holiday you have on leaving the company.

Given that information then for me it is quite a simple calculation to find your day rate of pay which is calculated by taking your annual salary based on your 4 day working week / 52.143 (weeks in the year) / 4 number of days you work per week) then take this figure and times by 36.46 the days holiday you are owed and that should given you how much holiday pay you are entitled to.

As an example based on an annual salary of £25,000 for a 4 day week

25,000 / 52.143 / 4 = £119.86 x 36.46 = £4370.19

I am really not sure why the company want to divide by the number of days in the month you are leaving as that is irrelevant for a holiday pay calculation, which is purely based on your daily rate of pay x no of days holiday you are owed.

Hope that helps.

[NettyNut]

Thank you again for prompt detailed reply. I too agree with the calculation given by yourself.

I was scarce with info initially as not sure how much detail one can expose to on here.

Presumably I am not able to identify the Employer though suffice to say I would have expected them to act within Government Guidelines .

Are you able to advise any further advise on how to go forward with this please?

I have already requested a Mandatory Reconsideration and that is when I received the above calculation which they deem correct (in yesterdays post.)

Many thanks again

[ULA]

No you should not identify your employer, since we are a public forum we encourage people to remain anonymous and not to post information which is identifiable either to them or the party they have an issue with.

Not being completely familar with a mandatory reconsideration process is the outcome something you can appeal? If so that would be the best route to go and prepare a well presented case for why you believe their calculation is incorrect. If there is an appeal mechanism and a time limit in which to do so then make sure you comply with this.

Are there any contractual clauses or policies/procedures that deal with the calculation of accrued but undetaken holiday pay on termination? If so it would be worth double checking whether the method they have used is consistent with those calculations.

[NettyNut]

Thanks again for a detailed prompt response.

I agree with the discretion on this site , though would i be allowed to quote any comments from yourself in further correspondence with my ex HR department? I would be happy to state I have asked legal advice....would that suffice?

Thanks again

[ULA]

I am more than happy for you to use content from my posts if that helps you put together a response. Just to let you know I am not an employment solicitor just have years of practical experience dealing with employment law issues.

[NettyNut]

Thanks again for a detailed prompt response.

I agree with the discretion on this site , though would i be allowed to quote any comments from yourself in further correspondence with my ex HR department? I would be happy to state I have asked legal advice....would that suffice?

Thanks again

Thank you. I shall keep you up to date with my progress. Many thanks for the advice and time you have given to me. An invaluable forum.