With a few simple clicks, users can configure their platform to automatically pay rolled-up holiday pay to their irregular-hour workers. Once this configuration is in place, leave will be seamlessly integrated into every pay period, making sure that employees receive their entitled compensation without delay.
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Step 1: Update the Pay Categories
Click Payroll Settings and then click the Pay Categories button under the Pay Run Settings section. Select the Pay Categories you would like the platform to include in the rolled-up holiday pay calculation and tick the Apply rolled-up holiday pay box within that category.
When you have selected any Pay Categories to be included in the rolled-up holiday calculation, the platform will automatically generate a new Pay Category called Rolled Up Hol therefore there is no requirement for you to do this.
Step 2: Update the Employee
From the Employees List select the Employee whose details you would like to apply the rolled-up holiday pay calculation to. Select Pay Run Defaults under Pay Run Settings and then select the Employee is Paid Irregularly tick box.
A box should then appear for you to tick called Apply rolled-up holiday pay. Once this has been selected, the Holiday pay percentage will default to 12.07% however you can over-ride this figure if you would like to.
Step 3: Pay-Run Calculation
When earnings have been paid against any pay categories which you have set up to be applied to the rolled-up holiday pay calculation, the platform will automatically calculate the figure to be paid to the employee in the Pay Run. This figure cannot be over-ridden.
The calculation is based on the .gov guidance
Calculation
A = Total £ value of all pay categories you have selected to be included as part of rolled-up holiday pay.
B = Percentage value saved against the employee (default 12.07%).
A/100 = Y
Y x B = V (Apply rounding to nearest pence)
Example
Employee A has worked 35 hours at an hourly rate of £10.42
35 x £10.42 = £ 364.70
£364.70 / 100 = £3.65
£3.65 x 12.07 = £44.0555
Round up to nearest pence
£44.06 = Rolled-up holiday pay
If your employee is paid any statutory or occupational leave within the Pay Run then the platform is not able to support the calculation as this introduces a 52-week reference period to gain an average of hours worked. If this does affect any of your employees in a Pay Run you will be notified of this via a Pay Run warning. The calculation of the rolled-up holiday pay will default to zero, but you will be able to over-ride this.
Step 4: Pay slips
The employee will be notified of the rolled-up holiday pay amount and the percentage used for the calculation on their pay slip.
Explore related content
- Payroll pay run reporting: Pay run comparison This feature allows you to create a report that you can use to compare your organisation's finalised pay runs over a chosen time.
- Payroll Pay Run Reporting: Pay run inclusions This feature allows you to create a report on the inclusions your organisation has processed within your finalised pay runs, with the ability to narrow this data down by employing entity, pay schedule, and location.