Holiday pay and normal remuneration : penalty rates and the amount owed

• Statutory floor for most workers: 5.6 weeks paid holiday (subject to the 28-day cap for people who work 6 days a week).
• 4 weeks (reg 13): paid at normal rate. GOV.UK says this can include payments intrinsically linked to contractual tasks (for example commission), status-related payments (seniority / qualifications), and other payments such as overtime that has been regularly paid in the 52 weeks before the calculation date. Bonus treatment depends on the nature of the bonus.
• Remaining 1.6 weeks (reg 13A): may be paid at basic remuneration (wages without bonuses, commission and similar extras). Shift premiums that form part of basic wages for the shifts you would have worked should still be reflected in that basic rate on GOV.UK's wording.
• Employers may pay all 5.6 weeks at normal rate; many do. The regulations do not say which pot of leave is used first.
• Irregular-hours and part-year workers (leave years beginning on or after 1 April 2024): different accrual (12.07%) and optional rolled-up holiday pay; their statutory leave is paid by reference to total pay under those methods (see the sister guide).
• Challenge underpayments via the employer, then Acas Early Conciliation / tribunal. Dual time-limit regime: most claims 3 months minus 1 day now; 6 months minus 1 day if the clock starts on or after 1 October 2026.

From 1 January 2024, GOV.UK states that the components which must be included when calculating the normal rate for the 4 weeks of regulation 13 leave are defined in the regulations. The reforms page lists:

1. Payments intrinsically linked to the performance of tasks you are contractually obliged to carry out (commission is the usual example).
2. Payments relating to professional or personal status linked to length of service, seniority or professional qualifications.
3. Other payments, such as overtime, that have been regularly paid to you in the 52 weeks preceding the calculation date.

Acas matches that list in worker-facing language: commission-style payments linked to contractual tasks; status-related payments; and other payments such as overtime if you have regularly received them during the last year. Employers must include relevant payments for at least 4 weeks of statutory holiday. They may include them for the full 5.6 weeks, but they do not have to.

Bonuses: GOV.UK says whether a bonus sits inside normal holiday pay depends on the nature of the bonus. Do not assume every annual discretionary award counts, and do not assume a regular production bonus never counts. Check the contract, how often it is paid, and what it rewards. If the pattern is unclear, get advice rather than relying on a blog rule of thumb.

Fixed hours and fixed pay: workers on a stable salary for fixed hours typically receive the same pay for a week's leave as for a week's work. The dispute usually appears when pay varies.

GOV.UK: the remaining 1.6 weeks under regulation 13A can be paid at basic rate, meaning basic remuneration without bonuses, commission and other additional payments. Basic pay should still reflect what you would have earned for the work pattern itself. If your rostered shifts attract a premium because of timing, that element of the wage for those shifts should be reflected when you are on that leave, on GOV.UK's explanation.

The regulations do not say whether employers must use the 4-week pot or the 1.6-week pot first. If your employer pays different rates for different weeks of leave, GOV.UK says they should explain that clearly and consistently (contract or handbook). Silence plus a sudden drop on every holiday week is a red flag.

Assume you are 30, entitled to the April 2026 National Living Wage floor of £12.71, but your contractual basic rate is £13.50 an hour for 37.5 hours a week.

• Basic weekly pay: 37.5 × £13.50 = £506.25
• In the last year you also worked regular paid overtime averaging £90 a week and earned commission averaging £60 a week
• Illustrative "normal" weekly figure for holiday maths: £506.25 + £90 + £60 = £656.25

Week of regulation 13 (normal) leave: holiday pay should aim at that normal pattern, not basic alone. Paying only £506.25 for a week drawn from the 4-week pot underpays by about £150 on these averages.

Week of regulation 13A (basic) leave: the employer may lawfully pay closer to basic remuneration for that slice, while still reflecting genuine shift-premium structure in basic wages where relevant. Paying £506.25 for a designated 13A week is closer to what GOV.UK allows than paying £506.25 for every week of the 5.6 entitlement when overtime and commission are regular.

Employer that does not split pots: many payrolls simply pay £656.25-style normal pay for all statutory weeks. That is allowed and usually simpler. The legal minimum is to protect the 4 weeks, not to strip the 1.6.

These figures are teaching examples. Real calculations use your reference period, your payslips, and (where hours or pay vary) averaging rules described on GOV.UK and Acas. They are not a substitute for running your own 52-week numbers.

Acas: if hours are fixed but pay varies, holiday pay uses an average hourly rate over the previous 52 weeks (excluding holiday pay in that reference period for that fixed-hours / variable-pay case, on Acas's wording). If you have no fixed hours, different rules apply.

Irregular-hours and part-year workers (definitions and methods on the GOV.UK reforms page), for leave years beginning on or after 1 April 2024:

• entitlement generally accrues as 12.07% of hours worked in the pay period
• employers may use rolled-up holiday pay (an extra amount each pay period, clearly itemised, paid with wages, based on total pay)
• if rolled-up is not used, a 52-week average of pay can still be used
• GOV.UK: for these workers, statutory holiday pay under those methods is based on total pay (the 4-week / 1.6-week split described above is the framing for full-year workers with the standard pots)

Cross-read the dedicated irregular-hours guide on this site rather than stretching this article into a second full manual. Rolled-up holiday pay must not be used to top up wages so that only the combined figure meets National Minimum Wage.

• It does not claim that every bonus type is included or excluded.
• It does not invent Employment Appeal Tribunal or Supreme Court holdings, or restate old case names as if they were the 2024 statutory list.
• It does not decide which of your leave days your employer has allocated to regulation 13 versus 13A when the handbook is silent.
• It does not replace advice on agency, salary-sacrifice, or atypical commission schemes.

If your pattern is messy (annual discretionary bonus, irregular overtime spikes, commission paid months late), treat the GOV.UK list as the starting map and get tailored advice.

1. Check your contract and handbook for holiday pay wording and any split between "normal" and "basic" weeks.
2. Gather payslips covering at least the last 52 paid weeks, plus commission statements and overtime records.
3. Compare holiday weeks with typical working weeks. Note which weeks were labelled or treated as basic-only.
4. Raise the gap in writing with payroll or HR. Ask which weeks were paid as regulation 13 leave.
5. If needed, start Acas Early Conciliation, then an employment tribunal claim. Acas: in most cases you have 3 months minus 1 day from the most recent wrong holiday payment. From 1 October 2026, for most claims the limit becomes 6 months minus 1 day if your time limit starts on or after that date (Acas time limits).
6. A grievance can help internally; it does not pause the tribunal clock.

Northern Ireland has its own tribunal system; this piece follows Great Britain practice.

• "Holiday is always basic pay." Not for the statutory 4 weeks when overtime, commission or other listed payments are part of normal pay under GOV.UK / Acas.
• "We pay 5.6 weeks basic, so we are compliant." Compliance turns on whether the 4-week pot reflected normal remuneration.
• "One overtime shift last year means every holiday week includes overtime forever." GOV.UK focuses on payments regularly paid in the preceding 52 weeks. Frequency and pattern matter.
• "Irregular-hours staff follow the same 4 / 1.6 split exactly as salaried staff." From April 2024 leave years they have their own accrual and pay methods; read that regime separately.
• "I will wait until I leave." Leaving claims exist, but waiting can collide with time limits and evidence gaps. Act on the underpaid holiday week you can already see.
• "Online calculators replace the regulations." Use GOV.UK and Acas as the primary references; tools only organise your figures.

Build a simple table: week of leave, pay received, typical overtime, commission, bonuses. Paye Mes Heures helps you line those pounds up before you contact your employer or Acas. It prepares a dossier; it does not decide regulation 13 versus 13A for you. Cross-check the reforms guidance, then get advice on edge cases.

• https://www.gov.uk/government/publications/simplifying-holiday-entitlement-and-holiday-pay-calculations/holiday-pay-and-entitlement-reforms-from-1-january-2024
• https://www.legislation.gov.uk/uksi/1998/1833/contents
• https://www.acas.org.uk/checking-holiday-entitlement/calculating-holiday-pay
• https://www.acas.org.uk/employment-tribunal-time-limits
• https://www.gov.uk/holiday-entitlement-rights