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Holiday pay paid each week

Holiday pay paid each week


Just taking on a new payroll client, they run 3 small coffee shop type businesses, mix of full time and part time staff. It's only been operating 2-3 mths. The current payroll bureau has been including holiday pay each month based on the hours worked. So when an employee does take time off it's 'unpaid' as they have already been paid.

I can't say we have come across this before, seems to have some merits in that you haven't got to work out their entitlement but I wonder if the staff fully realise what will happen when they have time off i.e. no pay.

Has anybody else come across this?



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By Monsoon
09th Sep 2011 20:30

This is rolled up holiday pay
This is rolledup holiday pay and it's not allowed. Google "rolled up holiday pay" and you will find guidance.

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10th Sep 2011 07:35

Term time workers

I operate a payroll for term time/irregular hours workers and that is how we incorporate the holiday pay too.

7 minutes for every hour worked I think the fraction is. 

I see term time workers are now under review so will have to watch for updates


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10th Sep 2011 07:49

to expand

My staff only work irregular hours, term time only.

The Direct Gov site 2 years ago detailed payment methods

I pay an hourly rate, specified in the contract.

The contract also states clearly that as all holidays are expected to be taken out of term holiday pay will be paid each month on the basis of 7 minutes for every hour worked. It is not part of the hourly rate and is shown separately on the payslip.

This article seems to indicate that this is still acceptable: 


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By wmbkaps
11th Sep 2011 15:05

Hello Mark

This type of arrangement is common for agency workers, temporary workers and part time/short term workers such as seasonal staff.

As you mention, the down site is staff may not be aware of the arrangement.  Any queries that arise shold be directed back to the named person responsible for payroll at the client.

We operate a number of small to medium payroll's and have a named contact at the clients.  Any queries come directly from them and are reported directly back to them.  The result is that the named contact can often answer a number of the queries without our involvement.

Hope this helps.


for West Midlands Bookkeeper & Payroll Services.

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20th Sep 2011 12:46

Thanks for the responses, looks like a 'can of worms' to me, thankfully not directly my problem but my partner's [also my wife].


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