July 31, 2023
At Premier Legal, we often get asked questions relating to HR services from both employees and employers. One of the most frequent questions revolves around pro-rata holidays.
To be specific, what is the pro-rata holiday meaning? In this post, we’re going to answer this question by taking a deep dive into pro-rata holidays and what this means for employers and employees.
Pro-rata is a Latin term that loosely translates to mean “proportional” or “in proportion”.
When we talk about pro-rata holidays, we are speaking about holiday entitlement that’s proportionate to the holiday entitlement of full-time employees. This is usually applied when dealing with part-time employees that either work fewer hours or are only contracted to work for a specific part of the year.
As an example, imagine you have one employee that works full-time and is in every day for 40 hours a week. You then have another employee on a part-time contract working 20 hours a week. It would be disproportionate to allocate both employees the same amount of annual holiday leave.
Instead, we use pro-rata holiday allocation to give the second employee a holiday entitlement that’s proportionate to their work in comparison with the full-time worker. In this case, they would be given half as much holiday.
Calculating pro-rata holidays can be extremely complicated as it depends on a few main factors:
- What does your business define as full-time hours?
- Do you allocate annual leave in hours or days?
- How much annual leave do you allocate to full-time employees?
There are no specific laws dictating what is or isn’t “full-time” work – it’s up to the employer to decide this. Start by defining your full-time hours & annual leave entitlement and you can go ahead and try this calculation:
(Full-time annual leave entitlement / Full-time working hours) x part-time hours
You can do the same equation if you process everything in days, but just switch hours for days. Here’s an example to show you how this works:
(210 hours of annual leave / 40 hours full-time working hours) x 20 hours part-time hours
5.25 x 20 = 105 pro-rata holiday hours
Let’s do another example using days, so you can see how that works too:
(28 days of annual leave/ 5 days of full-time working) x 3 days of part-time work
5.6 x 3 = 16.8 pro-rata holiday days
In both equations, once you’ve divided the full-time annual leave by the full-time work, you can then figure out any pro-rata holiday with ease.
Employees in the UK are legally entitled to 5.6 weeks of paid holiday a year.
This isn’t just for full-time employees – it’s for part-time ones too. A part-time worker is still entitled to at least 5.6 weeks of paid holiday, but this will come out to fewer than 28 days based on what they work.
This is where the whole pro-rata calculation comes in. 5.6 weeks of work for someone on a part-time contract is obviously less work than for someone on a full-time contract. As such, the holidays reflect this.
Moreover, we must note that some workplaces provide more than the minimum holiday entitlements. If this is the case, part-time workers are also entitled to this. So, if full-time workers get 7 weeks of paid holiday a year, part-time workers should also get this in proportion to what they work.
As an employee, it’s crucial to understand how much holiday you’re entitled to. It’s normal to be confused by some of the equations and points we’ve been discussing. Unfortunately, employers can also get confused by this, meaning they may allocate fewer days of leave than you’re entitled to. Most notably, problems occur when full-time employees get more than the minimum entitlements and part-time employees do not.
if you need help calculating holiday entitlement for your staff please get in touch.
The world of pro-rata holidays can be extremely complex, but Premier Legal is here to help. If you need assistance with assigning or calculating holidays for part-time employees, contact us today. We offer a range of HR services, including Virtual HR Services to help keep your business ticking over while you focus on what’s important.