What Are the Laws Around Annual Leave Entitlement?
Everyone deserves annual leave. But if you’re an employer, it can bring up a fair few questions:
How much time off are staff legally entitled to?
Does it include bank holidays?
What if someone works part-time or variable hours?
Getting to grips with what the law says can be overwhelming, especially if you don’t have access to an HR advisor.
So in this guide, we’re covering the basics of annual leave entitlement in the UK and why it’s important to get it right.
What does UK law say about annual leave entitlement?
According to UK employment law, most workers in the UK are legally entitled to at least 5.6 weeks of paid holiday per year.
For a full-time employee working five days a week, that adds up to 28 days annually. This includes:
20 days of statutory holiday +
8 standard bank holidays
It’s important to note here that although the 8 bank holidays form part of the statutory annual leave entitlement, employers don’t necessarily have to give those specific days as time off. For example, hospitality workers may have to work on bank holidays, but they’re still entitled to take the equivalent time off at another point in the year.
Part-time staff and seasonal/zero-hours staff are also entitled to 5.6 weeks of paid leave. However, this is calculated in proportion to the number of hours or days worked.
A few key things to remember:
5.6 weeks is the statutory minimum. However, many employers offer more as part of their employment package to attract the best talent.
There is no legal right to paid time off on specific bank holiday dates. Whether or not staff are required to work bank holidays should be clearly set out in your employment contracts and holiday policy.
The bottom line? Every worker in the UK is entitled to paid time off. And it’s the employer’s responsibility to manage annual leave fairly and in line with the law.
Who is entitled to paid annual leave?
Most people who work for your business will have a legal right to paid annual leave. This statutory right applies to:
Employees - which includes anyone with a contract of employment and full employment rights.
Workers - which includes any casual, agency, or zero-hours worker who regularly carries out work for your business.
Other common scenarios where holiday entitlement applies include:
During probation, employees begin accruing holiday from day one of employment, even if they’re in a probationary period.
During sick leave, employees continue to build up annual leave while off sick, and they have the right to carry over unused leave if they couldn’t take it because of illness.
During maternity, paternity, or adoption leave, statutory holiday continues to accrue throughout.
It's not uncommon for small businesses to overlook annual leave accruals during these less-visible times away from work, which can cause confusion or missed pay down the line. Having a well-structured holiday policy alongside accurate record-keeping can help prevent this.
Who isn’t entitled to paid annual leave?
It’s important to note that self-employed contractors do not qualify for statutory annual leave, as they are responsible for setting their own terms and workload.
However, self-employed scenarios aren’t always clear-cut.
For example, if someone is working regular hours, under your direction, and is economically dependent on your business, they may actually meet the legal definition of a worker rather than being genuinely self-employed. In that case, they would be entitled to paid annual leave and other employment rights.
Getting employment status wrong can lead to disputes and even legal claims, so it’s worth reviewing how you engage contractors and seeking advice from an HR partner if you’re unsure.
Calculating annual leave for part-time and variable hours staff
Calculating annual leave for full-time staff is easy. It’ll always be the statutory minimum, which is currently 28 days.
That being said, things can get a bit confusing if you need to calculate annual leave for your part-time and variable hours staff. Here’s a quick overview to help:
| Rule | How to calculate |
|---|---|
| Part-time staff on fixed hours |
Annual leave entitlement = 5.6 weeks each year, calculated pro rata for part-time staff. For someone working 15 hours per week: Multiply 5.6 (annual leave entitlement) × 15 (hours per week) = 84 hours of annual leave. |
| Casual, seasonal, or zero-hours staff |
Annual leave entitlement = 5.6 weeks each year, calculated based on the number of hours worked using the 12.07% rule set out by the UK government. For someone who worked 24 hours in any given pay period, multiply 24 (hours) × 12.07% = 2.8968 Then, round up to the nearest hour = 3 hours of annual leave accrued. |
If you’re trying to calculate annual leave for part-time staff manually, it’s easy to get lost in the spreadsheets. Our Part-Time Annual Leave Calculator can help you crunch the numbers in a matter of seconds, so you can focus on running your business.
Managing annual leave requests and busy periods
Every business has deadlines and seasonal rushes. While the law gives employees the right to take annual leave, it also grants employers some flexibility in how and when annual leave can be taken.
Notice periods
Typically, employees must give notice that they plan to take annual leave at least twice the length of the leave they want to take, plus one day. For example, if someone wants a week off, they should ask at least two weeks and one day in advance.
As the employer, you can approve or refuse the leave, but you must give notice equal to the length of the leave being refused plus one day. For example, one week (plus one day) notice to refuse one week of leave.
You aren’t legally required to give a reason for refusing a leave request. However, consistency and fairness are essential for maintaining trust with your staff.
Busy periods and cover
It is legal to:
Restrict leave during peak times - for example, in the run-up to Christmas for retail workers or at the end of the financial year for accountants.
Close the business and require staff to take leave - provided you give at least twice the length of the enforced leave as notice.
That said, it’s important to be clear about annual leave expectations up front, making sure to include any restricted dates or compulsory leave periods in your employment contracts.
Making annual leave work for your business
Yes, annual leave entitlement is set by the law. But the way you manage it day-to-day can really influence how your employees feel about working with you.
Here are a few best practices for making annual leave work for your business:
Have a clear, written policy, so everyone knows how leave is booked, what notice is required, and whether there are any restrictions.
Communicate openly by reminding staff about their entitlement, encouraging them to take time off, and handling requests fairly.
Use simple systems like spreadsheets or basic HR software to keep accurate records and avoid confusion.
Plan ahead for busy periods by setting expectations early about restricted dates or required cover.
Be consistent and apply the rules fairly across your team to build trust and avoid grievances.
Go beyond the statutory requirement to show employees you value their well-being (and attract better talent in the process).
When handled well, annual leave can play a strategic role in supporting employee well-being, boosting morale, and keeping your business running smoothly.
Need help creating an annual leave policy that works for your business?
Get in touch, and we can help you create a policy that aligns with UK employment law and your business goals.
