12/09/2026
Pay received by a worker while they are on holiday should reflect what they would have earned if they had been at work and working.
From 1 January 2024, the components which must be included when calculating ‘normal’ rate of pay are defined in regulations.
The following payments must be included in the 4 weeks of normal (regulation 13 leave) holiday pay:
*payments, including commission payments, intrinsically linked to the performance of tasks which a worker is contractually obliged to carry out
*payments relating to professional or personal status relating to length of service, seniority or professional qualifications
*other payments, such as overtime payments, which have been regularly paid to a worker in the 52 weeks preceding the calculation date
Whether bonuses are included in normal holiday pay depends on the nature of the bonus.
To sum up, a worker shouldn’t suffer financially when on leave, so the following should be taken into account when calculating the weekly average for holiday pay:
*commission that’s directly linked to performance of contractually mandated tasks
*bonuses that are directly linked to performance
*overtime if it’s mandatory or paid often enough to be considered part of their normal pay