For years employers have struggled to understand the rules about paying holiday pay and sick pay.
The government has now come up with a rather simple formula. It isn’t law yet so you can’t apply the new rules. However, if it becomes law this is how it is currently proposed to work:
- Annual leave – count the number of hours worked by your employee. Multiply this by 0.0769 and you get the number of hours of annual leave you should be granting your employee. So, if Alice works 200 hours then she gets an entitlement of 200 * 0.0769 hours of holidays. That works out at 15.38 hours. If you know her hourly rate you can easily calculate how much holiday pay she is entitled to.
- Sick pay – same idea only the figure you multiply by is 0.0385. So Alice’s entitlement to sick pay, if she has worked 200 hours is 7.7 hours.
- Casual workers - if you read the sick pay and holiday pay together it comes to 11.54% (.0769 + .0385). At present proposal is to round this up to 12.5%.
