How much holiday are your staff actually entitled to?

Holiday entitlement is one of those things every small employer assumes they've got right, usually because they copied it from a contract template or from whatever their last employer did. It's also one of the most common sources of genuine disagreement with staff — not because anyone's acting in bad faith, but because the rules are less obvious than they look, particularly the moment you have part-timers, casual staff or someone leaving mid-year.

Here's the plain-English version of what a UK employer actually owes.

The baseline: 5.6 weeks

Almost all workers in the UK are entitled to 5.6 weeks of paid holiday a year. The word doing the work there is *weeks*, not days — because entitlement is defined in weeks, it scales naturally to whatever pattern someone works.

For someone working five days a week, 5.6 weeks is 28 days. That's where the familiar '28 days including bank holidays' figure comes from. There's a statutory cap, so someone working six days a week is still entitled to 28 days rather than 33.6. And it's a minimum, not a target — you can always offer more, and plenty of small employers do because it's one of the cheapest ways to be a genuinely attractive place to work.

Bank holidays are not automatically on top

This is the single biggest misunderstanding. There is no automatic legal right to paid time off on a bank holiday. An employer can include the eight usual bank holidays within the 5.6 weeks, which is exactly what '28 days including bank holidays' means, leaving 20 days of discretionary leave.

What matters is that the contract says clearly which arrangement you're using. 'Twenty-eight days including bank holidays' and 'twenty days plus bank holidays' are very different offers, and the gap between what a new starter assumed and what the contract says is where the argument happens. Spell it out in the written employment contract rather than leaving it to be inferred.

Almost every holiday dispute in a small business traces back to a contract that said something slightly vaguer than what both sides thought it said.

Part-timers get the same 5.6 weeks, pro rata

A part-timer isn't entitled to less holiday — they're entitled to the same 5.6 weeks, which simply amounts to fewer days because their week is shorter. Someone working three days a week gets 5.6 × 3, or 16.8 days.

The complication with part-timers is bank holidays. If your business closes on bank holidays and someone happens to work Mondays, they lose more of their entitlement to bank-holiday closures than a colleague who works Wednesdays and Thursdays. The standard fix is to express everyone's entitlement in hours and deduct actual hours taken, which makes the arithmetic fair and visible for everyone regardless of which days they work.

Irregular hours, casual and part-year staff

This is where employers most often get it wrong, and where the rules have moved in recent years. For irregular-hours and part-year workers — think casual bar staff, seasonal retail, term-time-only roles — holiday for leave years starting on or after 1 April 2024 can be accrued at 12.07% of the hours worked in each pay period, and employers have the option of paying rolled-up holiday pay as an uplift on each payslip rather than paying it when leave is taken.

Two practical points. If you use rolled-up holiday pay, it must be itemised separately on the payslip — not quietly folded into the hourly rate, which is exactly the practice the rules were tightened to stop. And rolled-up pay doesn't remove the right to actually take the time off; staff are still entitled to the leave itself. Because this area has changed and continues to be refined, check the current guidance on GOV.UK or take advice before designing your approach — this is one to get right at the outset rather than unpick later.

Carry-over, and what happens when someone leaves

The general position is that statutory holiday should be taken in the leave year it relates to. There are specific circumstances where leave can or must be carried over — long-term sickness and family leave among them — but 'we were too busy' isn't one of them by default, and an employer who repeatedly refuses leave requests then declines to carry it over is heading for a dispute.

When someone leaves, you must pay them for any statutory holiday they've accrued but not taken. Get the calculation right: it's based on their entitlement accrued up to the leaving date, not on a whole year's allowance. The reverse situation — someone who has taken more leave than they'd accrued — can only be deducted from final pay if the contract explicitly allows it, which is a good reason to check that your template does.

The practical admin that prevents all of this

Three habits solve most holiday problems in a small business before they start. Set out entitlement clearly in every contract, including exactly how bank holidays are treated. Track leave centrally, in hours, somewhere both you and the employee can see it, rather than in your head or a scattering of emails. And define your leave year explicitly — a calendar year, your financial year, or each person's start date — because 'when does my allowance reset' is a question you don't want to be answering differently to different people.

It's twenty minutes of setup that prevents the kind of conversation that damages a good working relationship over what's usually a genuine misunderstanding rather than a real disagreement.