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Pro Rata Bank Holiday Entitlement Calculations

 
30
Oct

Pro Rata Bank Holiday Entitlement Calculations

Employers must ensure that all employees have at least the statutory minimum annual leave entitlement and that part-time employees are not treated less favourably than full-time employees.

Employees are entitled to 5.6 weeks’ paid annual leave and employers can elect to include bank holidays within this. For full time workers this equates to a minimum of 28 days (5.6 x 5 days). For a part time employee this clearly will be less, so for someone who works say Tuesday, Wednesday & Thursday only, the calculation is 5.6 x 3 days, making 16.8 days minimum entitlement.

Considering the statutory bank holiday element of that minimum entitlement, simply stating that employees can take the bank holiday that they work on will not be fair nor equal treatment of all employees. This can be illustrated if we were to look at our 28 days for a full time worker as being 20 days holiday entitlement and 8 days statutory bank holiday. We can see that they simply get, for example, Easter Monday off when it happens as it will coincide with their normal day of work. However, where employees work different fixed days each week, such a practice could put part-timers at a disadvantage because most bank holidays fall on a Monday or Friday. Our 3 day week worker used as an example above would clearly be unfairly disadvantaged by this method. So, in that perspective, part-time employees who do not work on these days could be entitled to proportionately fewer days off compared with full-time employees, depending on shift patterns and annual leave arrangements within the organisation.

Allowing full-timers a particular bank holiday off, but not part-timers, is clearly less favourable treatment and unlawful. Therefore, to remove any disadvantage and to avoid a complaint of less favourable treatment under the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000, many employers provide part-time employees with a pro-rated bank holiday entitlement. Whilst there may not be one all-encompassing arrangement that will have entirely fair results for all employees whatever their working pattern, one option is to calculate pro-rated bank holiday entitlement according to the number of hours that the part-time employee works, irrespective of whether or not he or she works on the days on which any bank holiday falls.

So, in our example of someone working a 3 day week, that employee’s FTE would be 0.6, and that factor would be applied the 8 bank holidays as well as their leave entitlement. This would give 4.8 (0.6 x 8) bank holidays and 12 (0.6 x 20) days leave – the total of which meets the statutory minimum of 16.8 days.

New capability has been developed and recently released within the Youmanage HR platform, which takes this one step further, to automatically adjust the employees’ entitlement to account for the bank holidays that are worked. The automatic calculations include pro-rating for new starters, leavers and changes to contracted hours part way through the entitlement year.

For information on how Youmanage automatically caters for these complex pro-rated bank holiday and holiday entitlement calculations, please contact us at enquiries@youmanage.co.uk or call us on 01786 458037.

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