Changes to Holiday Pay, Record Keeping, and TUPE Consultations Effective January 1, 2024!

Get ready for important changes in holiday entitlement, pay calculations, record keeping, and TUPE consultations. This is the topline information so far but there is more to come!

The government has responded to consultations and introduced new regulations to bring these changes into effect from January 1, 2024.

Holiday Pay: Roll-up Option for Some Workers

Starting from April 1, 2024, employers will have the option to roll up holiday pay for irregular hours or part-year workers. To qualify, holiday pay must be calculated at 12.07% of their pay and be paid alongside their ordinary pay. It’s important to itemize the holiday pay separately on payslips.

Definition of Normal Pay

The government has decided to maintain two separate pots of annual leave – four weeks’ EU-derived leave and 1.6 weeks’ domestic leave. EU-derived leave must be paid at the worker’s normal rate of pay, while domestic leave can be reduced to basic pay. This applies to payments that are intrinsically linked to the worker’s tasks, payments for professional or personal status, and regular overtime payments.

New Accrual System for Part-Year and Casual Staff

A new accrual method will be introduced for irregular and part-year workers. Effective from April 1, 2024, their holiday entitlement will be calculated at 12.07% of hours worked in each pay period. This overrides the Supreme Court’s decision and ensures that all workers receive fair holiday entitlement.

Clarity on Carrying Over Holiday

For the first time, regulations have been set out to determine when a worker can carry over leave from one year to another. This includes situations where the employer denies paid leave, the worker hasn’t had a reasonable opportunity to take it, or they are unable to due to illness or other types of leave.

Updates to Record Keeping

Employers will now be required to keep “adequate” records to demonstrate compliance with working time regulations, including the maximum working week, health assessments, and transition from night work to day work.

TUPE Consultations Made Easier

Small businesses with fewer than 50 employees or those involved in a small TUPE transfer of fewer than 10 employees can now inform and consult directly with affected employees, even without existing worker representatives.

Get ready for these changes and ensure compliance with the latest regulations for a smoother and more efficient working environment.

Any questions, please don’t hestitate to give the Breathing Space team a call. Always happy to help!