New Year, New Legislation

Senior Associate, Claire Hollins discusses the new draft legislation on calculating holiday pay for part year and irregular hours workers.

The Government has this week published its response to consultations launched earlier in the year on calculating holiday pay for part year and irregular hours workers and growing the economy. The result is new draft legislation snappily titled Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023.

Due to come into force on 1 January 2024 (which for those already panicking about the festive season is a mere 8 weeks away) if approved by parliament (which will likely be no more than a formality) the new regulations:

• Remove the requirement to keep records of daily working hours for workers where compliance can be shown without doing so;
• Clarify what ‘normal’ remuneration means for the purposes of calculating holiday pay
• Introduce definitions of ‘irregular hours workers’ and ‘part year workers’ (by amendment to the Working Time Regulations)
• Create a new system for calculating holiday entitlement for irregular and part year workers at the rate of 12.07% of the hours worked in the relevant pay period
• Allow rolled up holiday pay
• Codify case law (which is largely derived from retained European case law) on holiday carry over for employees who are unable to take their leave in the holiday year due to sickness absence, maternity or other statutory leave and in other specified circumstances such as where an employer has failed to recognise a right to holiday
• Remove the requirement to elect representatives for the purposes of TUPE consultation for Businesses with fewer than 50 employees and transfers involving fewer than 10 employees

As with all legislative changes, the devil is in the detail. To find out more, book a place at our free December HR breakfast club Here or contact Claire Hollins.