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Holiday Pay for Staff Who Work Irregular Hours: What You Owe and How to Pay It

Rolled-up holiday pay, a 12.07% uplift added to every payslip instead of holiday pay held back until leave is taken, has been lawful for irregular-hours and part-year workers since leave years beginning on or after 1 April 2024. Here is who qualifies, where the 12.07% figure comes from, what has to appear on the payslip, and the record-keeping duty that started on 6 April 2026.

Alex Riesenkampff

September 4, 2026 · 12 min read · Markdown

Since leave years beginning on or after 1 April 2024, an irregular-hours or part-year worker in the UK can lawfully be paid rolled-up holiday pay: a 12.07% uplift added to their normal pay every period, shown as its own line on the payslip, instead of holiday pay held back until they take leave. That covers most of a hospitality casual bench: zero-hours contracts, casual shifts, bank staff, and anyone whose hours genuinely vary from one pay period to the next. It does not cover a fixed rota, however irregular it feels to run. This article works out who qualifies, where the 12.07% figure comes from, what has to appear on the payslip, and what changed on 6 April 2026 that makes getting the paperwork right worth doing properly.

Who counts as an irregular-hours worker, and who does not

A worker only qualifies as an irregular-hours worker if their contract makes the number of paid hours they will work in each pay period wholly or mostly variable, the exact test the 2023 regulations use to decide who this whole system applies to. The Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023 (SI 2023/1426) inserted these rules into the Working Time Regulations 1998 from 1 January 2024. They define an irregular-hours worker as one for whom "the number of paid hours that they will work in each pay period during the term of their contract in that year is, under the terms of their contract, wholly or mostly variable." A part-year worker is defined separately: someone required to work only part of the year, with periods of at least a week, within the term of the contract, when they are neither required to work nor paid.

ACAS translates that into practice terms: "irregular hours workers usually include people on zero-hours contracts, casual contracts or bank contracts." A part-year worker in a hospitality setting is typically seasonal staff who work a defined season and nothing outside it. GOV.UK's own worked example uses a seasonal farm worker who "only works and gets paid during spring and summer months," the same shape as a terrace team hired for a summer season or Christmas casuals brought on for December alone.

What disqualifies a worker is a fixed pattern, not a low headcount or a casual-sounding contract. Anne Morris, founder and managing director of employment law firm DavidsonMorris, puts the test plainly: "even if workload fluctuates in practice, a contract that specifies regular hours or a predictable working pattern will normally take the worker outside the scope of lawful rolled up holiday pay." A rota that alternates fixed weekly totals, 15 hours one week and 20 the next on a repeating cycle, is still a fixed pattern under the contract even though the number changes from week to week, so it falls outside the irregular-hours category despite the variation. What matters is whether the pattern itself is fixed, not whether the hours are always the same number.

The test is what the contract says, not what actually happens week to week: a worker whose contract still makes hours wholly or mostly variable stays an irregular-hours worker even if their real pattern has settled into the same three shifts for months, and rolled-up pay stays lawful for them on that basis. Neither ACAS nor GOV.UK addresses what to do when practice has quietly diverged from the contract like this. The safer response is to review a long-serving casual worker's real pattern periodically and, where it genuinely has become fixed, update the contract to match it, rather than changing the payslip treatment first and leaving the paperwork behind.

Where the 12.07% figure comes from, and the two ways to pay it

The 12.07% figure is not a policy choice, it is arithmetic: GOV.UK's own guidance derives it as 5.6 weeks of statutory leave against 46.4 working weeks in a year, and the figure has not changed since the rules took effect. GOV.UK spells out the sum directly: "The 12.07% figure is based on the fact that all workers are entitled to 5.6 weeks' leave. This means that a worker's total working weeks in a year is 46.4 (52 weeks in a year minus 5.6 weeks of leave). 12.07% of 46.4 is 5.6." The regulations themselves put it as a straight uplift, at regulation 16A(2) of the amended Working Time Regulations 1998: "Such holiday pay may be paid by way of a 12.07% uplift to the worker's remuneration for work done."

An employer using rolled-up pay adds 12.07% of what the worker earned in a pay period to that same payslip, at the same time as ordinary wages. GOV.UK's own worked examples show the method on real numbers: a worker earning £364.70 in a week gets £44.06 added as rolled-up pay, and a worker on two rates over a fortnight, 20 hours at £11 and 20 hours at £12, earns £460 and gets £55.52 added. Both figures come from GOV.UK's own calculation of the 12.07% uplift on that period's pay, worked to the nearest penny.

The alternative is to bank leave in hours rather than pay it out every period, and it produces the same annual entitlement on a different schedule. A worker accrues 12.07% of the hours they worked in each pay period, rounded to the nearest hour, and gets paid for that leave only when they take it, at their average pay over the previous 52 weeks rather than their current rate. GOV.UK's rounding rule is specific: hours "can be rounded down (to zero if it is less than 30 minutes) but will be rounded up to one hour if it is 30 minutes or more than 30 minutes." Its own example shows the arithmetic: a worker who does 68 hours in a month accrues 8.2076 hours, which rounds to 8 hours banked toward future leave. ACAS gives the payout side with its own example: a worker whose average pay over the previous 52 weeks is £250 gets £250 for a week of holiday taken, whatever their current rate happens to be.

Both methods are the same statutory entitlement, 5.6 weeks a year, paid on a different schedule. Choosing one does not give a worker more or less leave than the other.

What has to appear on the payslip, and what a mislabelled one risks

Both GOV.UK and ACAS require rolled-up holiday pay to be shown as its own separate line on the payslip, not folded into the hourly rate, and getting the eligibility test wrong is the more expensive mistake to make. GOV.UK states the payslip rule without qualification: rolled-up pay has to be "clearly marked as a separate item on each payslip." ACAS repeats the requirement in its own words: employers must "show it as a separate payment on the worker's payslip." The regulations back it with a statutory itemised pay statement requirement, which has to "indicate the amount of holiday pay that has been paid for the period to which the statement relates."

The same GOV.UK guidance is explicit about one line that must not move: "rolled-up holiday pay is to be paid in addition to the worker's normal salary, which should be at National Minimum Wage or above." The 12.07% cannot be blended into a headline hourly rate to help that rate clear the minimum wage; it sits on top of a rate that already clears the minimum wage on its own.

Getting the eligibility test wrong, not just the payslip formatting, carries the real exposure. Law firm Irwin Mitchell's own guidance on the 2024 reforms warned that misclassifying a worker under the wrong test is not a paperwork slip. "If you incorrectly categorise a worker as a Regulation 15F worker and calculate their holiday entitlement using rules that apply to this category of worker, they will be able to bring a claim against you under the WTR if they have received less holiday (and therefore pay) than they would otherwise have been entitled to," the guidance states. The exposure is not capped at the usual two years either: such claims, it notes, "are not subject to the two-year limitation that applies to claims brought under the Employment Rights Act 1996 as a series of unlawful deductions." Its practical advice was blunt: "claims can, potentially, go back many years. It is therefore important that you review the workers who may be impacted before deciding on the approach you wish to take."

The record-keeping duty that started on 6 April 2026

Since 6 April 2026, employers have had to keep annual leave and holiday pay records for at least six years, a duty ACAS says is backed by a criminal offence carrying unlimited fines, whichever payment method a venue uses. Section 35 of the Employment Rights Act 2025 inserted this record-keeping duty into the Working Time Regulations 1998. ACAS states the obligation and the stakes plainly: employers "must keep records of annual leave and holiday pay" and "must keep records for at least 6 years from the date they were made." If an employer cannot prove they have kept those records, ACAS warns, "it could be a criminal offence," enforceable by the newly created Fair Work Agency, with a maximum penalty ACAS describes as "unlimited fines." That duty applies whichever method a venue uses: the payslip line satisfies the payment rule, not the record-keeping one.

Enforcement itself is not yet settled. A GOV.UK consultation, "Make Work Pay: Holiday Pay Compliance and Enforcement," opened on 30 June 2026 and runs until 22 September 2026, so it remains open as this is written. Without proposing to change the rolled-up pay rules themselves, it proposes civil penalties of 200% of unpaid holiday pay per worker, capped at £20,000 per worker, and a six-year claim lookback aligned with existing National Minimum Wage enforcement. None of that is law yet, and Fair Work Agency checks on holiday pay specifically are not expected to start before 2027. Read it as a signal of where scrutiny is headed, and treat the record-keeping duty above, already in force since April, as the deadline that has already passed.

Rolled-up pay or the accrual method: which to choose

Rolled-up pay is the simpler system for most small hospitality venues to run, but it is not the only lawful option, and telling staff in advance is not optional either way. Rolled-up pay needs one calculation and one payslip line, with no need to track hours banked over months, and a worker sees the value as they earn it rather than waiting for a specific week off. The accrual method concentrates the same total pay into the weeks leave is taken, which can mean several payments landing in the same month if a handful of staff take August off together, worth planning around at a venue that already runs close to its labour-cost ceiling. Our restaurant labour cost benchmarks cover what headroom looks like before adding either version of this cost.

Whichever method is chosen, ACAS expects workers to be told in advance, which in practice usually means writing the method into the contract rather than switching it silently partway through employment. The recommended default for a small venue with a genuinely casual bench is rolled-up pay, on the payslip, told to new starters at the offer stage. The exception is a venue that already runs accrual-based payroll software comfortably: there is nothing wrong with using the accrual method for every irregular-hours or part-year worker instead, since both methods stay restricted to that same category of staff and neither one extends to a worker with regular, fixed hours.

Where Super44 fits

Super44's native staff scheduling and time tracking already keep the shift history an irregular-hours holiday pay calculation starts from: hours worked, cover, and approved time off, recorded as part of the normal weekly workflow rather than reconstructed after the fact. Approved time data exports in human-readable form, which still has to be combined with each worker's pay rate to produce a 52-week average or a rolled-up figure, but the hours-and-dates half of the sum stops being a manual lookup. The six-year retention duty stays the owner's own obligation to meet; a scheduling system holds the underlying record, it does not discharge that duty by itself.

For sick pay under the day-one reform, the same record already does double duty: absence dates and hours worked feed both calculations from one place. Our tronc scheme guide covers the one place holiday pay has already reached an employment tribunal over tips, a reminder that this is not a risk confined to zero-hours contracts. If moving a long-serving casual worker onto guaranteed hours is part of a wider change at your venue, our guide to the Employment Rights Act's coming rota changes covers what else is shifting from 2027.