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On 1 January 2024, the government introduced changes to the Working Time Regulations by introducing The Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023. In particular, relating to the right to statutory paid holiday or annual leave for irregular hours workers and part-year workers for leave years beginning on or after 1 April 2024.
Guidance provided by the Department of Business and Trade, which can be found here, sets out that a worker is an irregular hours worker in relation to a leave year, if the number of paid hours that they will work in each pay period during the term of their contract in that year is, under the terms of their contract, wholly or mostly variable.
A worker is a part-year worker, in relation to a leave year, if, under the terms of their contract, they are required to work only part of that year and there are periods within that year (during the term of the contract) of at least a week which they are not required to work and for which they are not paid. This includes part-year workers who may have fixed hours, for example, teaching assistants who only work during term time, and who are paid only when working.
For leave years beginning on or after 1 April 2024, there will be a new accrual method for irregular hour and part-year workers. Holiday entitlement for these workers will be calculated as 12.07% of actual hours worked in a pay period.
As is currently the process, upon the formal insolvency of a company, the holiday pay calculations for claimants will be carried out at source using company payroll by either the company or the IPs and their agents. However, the information required of the claimant who is an irregular hours worker on the online RP1 claim form will change in the interim for whose leave years commence after 1 April 2024. Any claimant who is a part-year worker will not generally be affected by the new process. A permanent solution is in the process of being developed and will be rolled out shortly.
For claimants, the Redundancy Payments Service is introducing the following changes in the interim:
1. Changes to the “Before you start your claim form”, ensuring irregular hours and part-year users do not start their form until they have used the external calculator provided by DBT on gov.uk to calculate their entitlement, or they continue to begin their form knowing they can defer to the IP’s figure.
2. Changes to the online RP1 form, where a user can enter their entitlement value or choose to defer to the IP.
A permanent solution is being developed and will be rolled out shortly for claims from irregular hours and part year workers. We will update further in due course. It is not envisaged that there will be any changes to the RP14a upload. This will only affect holiday pay accrued. Holiday pay (taken but not paid) will not be affected nor will any other statutory entitlements.
Enquiries regarding this article may be sent to:
Insolvency.Technical@insolvency.gov.uk
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