All UK workers are entitled to 5.6 weeks (or a minimum of 28 days) of holiday over a full year, with pay equivalent to what the employee would earn in that period.

Calculating accrued holiday with Planday

Planday’s accrued holiday feature keeps accurate track of the amount of paid leave each employee has earned, as well as how much should be paid out for each holiday day.

We offer 5 different options to calculate vacation earnings:

  • Do not use - no money is paid out with vacation.
    This option can be useful for full-time monthly salaried employees that already get paid also when on Holiday.

  • Previous 12 weeks

  • Previous 13 weeks

  • Previous 52 weeks
    This option is a calculation that is compliant in the UK. We calculate the average earnings in the last 52 working weeks. For hourly accounts (units in hours) we calculate the average earnings per hour. This value is multiplied by the number of hours used in a Holiday. Likewise for daily accounts (units in days), we calculate the average earnings per day. See more information about this below.

  • Set fixed rate.
    This option is to not use the average calculation but instead always use a set fixed rate of leave pay per day.

    Please, keep in mind that if your chosen method gives you a value inferior to the one that the previous 52 week calculation would give you, you would not be compliant with the UK government holiday regulations.

Previous 52 weeks option:


Source: https://www.gov.uk/holiday-entitlement-rights/holiday-pay-the-basics

We look at the data and calculate the total earnings in the period, from approved shifts and supplements with aligned shift types. We also calculate the total time worked in the period, from approved shifts with aligned shift types. We then divide the numbers and find the avg. earnings per hour or avg. earnings per day.

Details on which supplements are included in the calculations:
Included:

  • Normal supplements for aligned shift types

  • Manual supplements for aligned shift types

Not included:

  • Week based supplements

  • Day based supplements

  • Time based supplements

  • Seniority supplements

  • Personal supplements

  • Salaried payroll is not included either


In other words;

  • if a shift is not approved it’s not included in the avg. calculations.

  • if a shift has a shift type that’s not included for accrued account type, it’s not included in the avg. calculations.

Example with details shows for the calculation: (Simple example)

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Example with details shows for the calculation: (Complex example)

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The text marked in green and red in the picture above shows the main differences between the two examples.

All the above have an impact on the leave pay calculation:

  • two shifts had shift types “Sick” or “Personal day”, not aligned to account.

  • one shift is not approved

  • one shift had an aligned supplement, which is included

  • one shift had a supplement, that had a shift type that was not aligned.

  • three shifts were subject to a pay raise from 9 to 10£ hourly wage.

Taking Holiday

How much does a week of holiday cost? We offer multiple options to manage this.

If you’re using accounts in DAYS:
A normal example is a week of holiday based on workdays. In the example below, the Holiday cost is one day from Monday to Friday, a total of 5 days each week. (Reach out to our support team if you need to change the setup of workdays in your portal.)

You can also base it on shifts in the Schedule. In this case, nothing will be deducted from the holiday balance on days without a shift in the schedule. In the example below the Holiday cost for the entire week would be 4 days, even if the request is from Monday - Sunday. Only the days with a shift in the schedule will deduct a value from the holiday balance. (Contact our support team, if you want this setup on your portal.)

The leave pay is the number of days multiplied by the monetary value per day. This is the value that’s showed in the Absence requests under Schedule > Absence requests. In the example below the monetary value is 90 £ per day and 360 £ for the whole request (4 days X 90 £ per day = 360 £)

If you’re using accounts in HOURS:
We offer 5 different options for determining how the holiday balance should be calculated.

  • Employee setting
    This option listen to the value set under Edit employee > Field: Hours/month. The logic behind this is that depending on which month the holiday is within, the number of hours is divided by the number of workings days within the given month.

    Example with a contract of 160 hours per month:
    20 working days in a month would return 160/20 = 8 hours per day.
    22 working days in a month would return 160/22 = 7.27 hours per day.

  • Previous 12 weeks

  • Previous 13 weeks

  • Previous 52 weeks
    This option is a calculation that is compliant in the UK. We calculate the average hours per worked day in the last 52 working weeks. This value is multiplied by avg. earnings per hours and the leave pay found. See more information about this below.

  • Set fixed rate
    This option allows you to set how many hours a day of Holiday should cost, regardless of what the average hours worked per day is.
    Please, keep in mind that if the fixed rate value is inferior to that of the 52 weeks average calculation, it won't be compliant with the UK regulations.

Previous 52 weeks option:

The system will calculate the cost of a day, based on the working patterns for the past 52 weeks.

Example:
If an employee always has the same work pattern of:

  • Monday: 2 hours

  • Tuesday: 10 hours

  • Thursday: 12 hours

  • Friday: 2 hours

  • and this has been the case for the past 52 working weeks

the avg. will be (2+10+12+2) / 4 = 6.5 hours per day.
When the portal is based on workdays, all working days set in the portal will have a cost of 6.5. So if Monday - Friday is set as a working day the cost would be 5x6.5 = 32,5 hours.

If the same employee only takes Holiday one day. The day will cost 6.5 hours regardless of it was on a 2-hour shift or 10-hour shift or no shifts at all.

However, we do offer another option, where we only listen to already scheduled shifts. With the same working pattern as above, the whole week off will in this case cost 26 hours. Only Monday off will cost 2 hours, only Tuesday off will cost 10 hours, only Thursday off will cost 12 hours, and only Friday off will cost 2 hours (see example below). Be aware that this option requires that shifts have been planned and put in the schedule before the Holiday requests are made. (Contact our support team, if you want this setup on your portal)

Requesting vacation / deducting holiday balance

Before approving a request, the manager can both see and amend the holiday impact for each day if needed. You can do this by clicking on “Show detailed impact”. A new line will appear below each day, where you can amend the cost for the individual days.

You can read more about how to approve/decline/amend requests here.

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