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Get Started For FreeFree Leaver Holiday Pay Calculator UK
Calculate accrued holiday entitlement and any payment owed when an employee leaves mid-year.
Leaver Holiday Pay Calculator
Results
Days elapsed / total
/
Accrued entitlement
days
Holiday balance (accrued minus taken)
days
Daily rate
Payment owed to employee
The employee has unused accrued days. This amount should be included in their final pay.
Overpayment - employer may reclaim
The employee has taken more days than accrued. This may be deducted from final pay if the contract allows it.
No adjustment needed
£0.00
The employee has taken exactly the right amount of holiday for the portion of the year worked.
Holiday Pay Daily Rate Calculator
Results
Daily rate
Weekly rate
Hourly rate
Based on working days per week × 52 weeks = working days per year.
How Leaver Holiday Pay Works in the UK
When an employee leaves a job part-way through the leave year, their employer must calculate how much holiday they have accrued up to their last working day. If the employee has taken less holiday than they have accrued, the employer owes them payment in lieu. If they have taken more than their accrued share, the employer may be entitled to reclaim the overpayment from final pay. This is governed by the Working Time Regulations 1998 and is one of the most common sources of payroll queries when someone resigns or is dismissed.
How Accrual Is Calculated
The standard approach is to calculate the proportion of the leave year that has elapsed up to and including the employee's last working day, then apply that proportion to their full annual entitlement. The formula is:
Accrued entitlement = annual entitlement × (days elapsed / total days in leave year)
For example, if an employee with 28 days of annual leave has their last day on 30 June in a January-to-December leave year, they will have been employed for 181 out of 365 days. Their accrued entitlement is 28 × (181 / 365) = 13.88 days. If they have taken 10 days, they are owed pay for 3.88 unused days.
Can Employers Deduct Overpaid Holiday from Final Pay?
Yes, but only if the employment contract includes a clear clause allowing the employer to make such a deduction. Under the Employment Rights Act 1996, deductions from wages are generally unlawful unless the worker has consented in writing (typically through a clause in their contract of employment). Without this clause, the employer cannot simply withhold the money from the final payslip, even if the employee has taken more holiday than they have earned. This is one of the most common areas of dispute in final pay calculations, which is why it is important to have the right contractual terms in place from the start.
What Happens During the Notice Period?
Employees continue to accrue holiday during their notice period, whether they are working their notice or on garden leave. If the employer asks the employee to take some of their remaining holiday during the notice period, they must give at least twice as much notice as the amount of leave they want the employee to take. For instance, if the employer wants the employee to take five days of holiday during notice, they need to give at least ten days' notice of that requirement. During garden leave, the employment contract is still active, so accrual continues as normal.
Calculating the Daily Rate
For salaried employees, the holiday pay daily rate is typically calculated as the annual salary divided by the number of working days in the year. The most common formula is:
Daily rate = annual salary / (working days per week × 52)
For a full-time employee earning £30,000 per year working five days a week, this gives a daily rate of £30,000 / 260 = £115.38. This is the amount used to calculate payment in lieu of untaken holiday, or the amount that may be deducted for each overpaid day.
Legal Protections and Common Disputes
The most frequent disputes around leaver holiday pay involve:
- Missing contractual clauses: Employers who try to claw back overpaid holiday without a written agreement in the contract.
- Incorrect accrual calculations: Using months instead of calendar days, or failing to include the notice period in the accrual window.
- Variable pay workers: For employees with irregular hours or commission-based pay, the holiday pay calculation must use a 52-week reference period of earnings, not just the basic salary.
- Statutory minimum protection: An employer can never reduce a worker's pay below the statutory minimum holiday entitlement (5.6 weeks). Deductions can only apply to the portion above the statutory floor.
For a full overview of UK holiday law, including carry-over rules and part-time entitlements, see our UK holiday entitlement guide.
Related Tools and Guides
- Pro-Rata Calculator - work out part-time salary and holiday entitlement.
- Part-Time Holiday Entitlement Guide - step-by-step worked examples for part-time workers.
- UK Employment Law Guide - every law affecting staff leave in one place.
Frequently Asked Questions
Calculate the proportion of the leave year elapsed up to the employee's last working day, then apply that fraction to their full annual entitlement. Subtract holiday already taken to find the balance. If the balance is positive, the employer owes payment in lieu. If negative, the employer may reclaim the overpayment if the contract allows it.
Only if the employment contract includes a written clause allowing the deduction. Under the Employment Rights Act 1996, unauthorised deductions from wages are unlawful. Without a contractual clawback clause, the employer cannot withhold the money from the final payslip.
Yes. Employees continue to accrue holiday throughout their entire notice period, whether they are working their notice, on garden leave, or being paid in lieu of notice. The accrual calculation should run up to and including the last day of employment.
For salaried employees, divide the annual salary by the number of working days in the year (working days per week multiplied by 52). For example, a full-time employee earning £30,000 working 5 days a week has a daily rate of £30,000 / 260 = £115.38.