How do I calculate holiday pay?
Holiday pay should be calculated on an employee’s normal rate of pay. This should include their basic pay, together with payments intrinsically linked to their role. Current caselaw shows that this will normally include guaranteed and compulsory overtime, commission, bonuses related to performance, and other allowances, such as shift allowances. The rules are complex and advice on your own circumstances is essential to ensure you do not overpay or underpay holiday entitlement.