Great Britain
The accrual rules in this post sit in the Working Time Regulations 1998, which cover England, Wales and Scotland. Northern Ireland has its own working time regulations — if your venue is there, check the position locally rather than assuming this applies.
Holiday for variable-hours staff builds up at 12.07% of the hours they actually worked, worked out on the last day of every pay period and rounded to the nearest hour there and then. That last part is the bit that catches people out: the entitlement is the sum of twelve rounded monthly figures, not 12.07% of the year’s hours.
The same percentage does two different jobs, and it is worth separating them before any of the sums make sense. 12.07% of hours worked is holiday entitlement, counted in hours. 12.07% of pay is rolled-up holiday pay, counted in cash, and it is optional. This post does both, taking one month of a fifteen-person pub’s rota line by line — the rounding, the total, and the two places the arithmetic goes wrong.
Quoted
Regulation 15B, in its own words
An irregular-hours or part-year worker accrues annual leave, on the last day of each pay period, at “12.07% of the number of hours that they have worked during that pay period” — and the same regulation caps it: “a worker cannot, in any leave year, accrue more than 28 days of annual leave under this regulation.”
First, who it is actually for
Of the fifteen people on this pub’s books, eleven are on the 12.07% method and four are not. The split is not about how the venue feels about its rota — it is a contract test, and it is set out in regulation 15F:
- An irregular hours worker is one whose paid hours in each pay period are, under the terms of their contract, wholly or mostly variable. Zero-hours, casual and bank contracts are the usual shape.
- A part-year worker is contracted to work only part of the year, with periods of at least a week inside it that they are not required to work and are not paid for. A part-year worker does not need variable hours to qualify.
The pub’s general manager, head chef, sous chef and one full-time bartender are all on fixed contracted hours. They get 5.6 weeks of their own working pattern, capped at 28 days, and none of what follows applies to them.
The expensive version of this mistake
Putting fixed-hours staff on 12.07% because it is easier to run one method for everybody. For a member of staff on set days it is the wrong entitlement, and paying it as rolled-up holiday pay on their payslip is not lawful for them at all. The method follows the contract, not the payroll’s convenience.
The month
One monthly pay period, ending 31 August 2026. These are the hours the eleven variable-hours staff actually worked — the figure the rota and the clock-ins produced, not the hours anyone was rostered for.
Take one line of it slowly, because every other line is the same three steps.
Those three steps are GOV.UK’s own — divide the hours by 100, multiply by 12.07, round to the nearest hour — and the rounding rule is the one in regulation 15B(3): a fraction of less than 30 minutes counts as nothing, and a fraction of 30 minutes or more counts as a whole hour.
The rounding is not tidying-up. It is the sum
Look at the bottom of that table again. The eleven of them worked 950.75 hours in the month, and the holiday they accrued is 117 hours.
Now do it the way almost every spreadsheet does it: 12.07% of the whole 950.75 hours is 114.76 hours — the middle column above adds up to the same thing, give or take the two decimal places it is shown to. The two figures are more than two hours apart, in a single month, in a pub with eleven casuals.
Which of the two is the entitlement
The 117. Regulation 15B does the sum on the last day of each pay period and rounds that period’s result on its own, so the accrued figure is the total of the rounded amounts. Applying 12.07% once to a whole year’s — or a whole month’s — hours produces a different number, and it does not reproduce the regulation 15B calculation.
The gap is not a rounding error in the loose sense — it is the rounding, and it does not reliably favour anybody. Each period’s rounding moves one person’s figure by up to half an hour in either direction. In this month it happened to land in the staff’s favour. Run one of the same people across a full leave year and it lands the other way:
The bound is easy to state and worth knowing: each period’s rounding can move one person’s unrounded figure by almost half an hour, in either direction. Pay monthly and the extreme case is around six hours a year for one member of staff, and around sixty-six hours across eleven of them. That is a ceiling rather than a forecast — but it is a ceiling sitting inside a figure that looks like it was calculated properly.
The same percentage, in cash
The second use of 12.07% is money rather than hours. Rolled-up holiday pay is a 12.07% uplift on what the member of staff earned in the pay period, paid at the same time as their wages and shown as its own line on the payslip, instead of paying holiday when it is taken.
For the month above, if every one of those eleven were on the £12.71 National Living Wage — the rate for staff aged 21 and over from April 2026 — the 950.75 hours cost £12,084.03 in wages, and the rolled-up holiday pay on top is £1,458.54.
Two conditions come with it, and both are in regulation 16A: it is available for irregular-hours and part-year staff only, and the payslip has to show the holiday pay for the period it covers. Acas puts the rate at at least 12.07% of total pay in the pay period.
That “at least” matters if your contracts promise more than the statutory 5.6 weeks. 12.07% is the figure for the statutory minimum; GOV.UK works the same sum for a contract giving six weeks — 6 ÷ 46 = 0.1304 — and gets 13.04% of the hours worked. If you have promised more than the minimum and you are accruing on a percentage, the percentage has to be the one your own contracts imply.
What happens when somebody is off sick
Accrual does not stop for sick leave or for statutory leave such as maternity leave — but it cannot be 12.07% of hours worked, because there are none. Regulation 15C substitutes an average:
A bartender averaging 26.25 hours a week over that reference period accrues 3.17 hours of holiday for every week they are off. It is a different sum from the one everyone else in the pub is getting that month, and it needs a year’s worth of weekly hours to produce it — which is the first place a venue running on paper discovers what it has not been keeping.
The 28-day cap
Regulation 15B is explicit that a worker “cannot, in any leave year, accrue more than 28 days of annual leave under this regulation”. For most of the eleven above it is nowhere near binding. Where it starts to matter is somebody working substantial hours across most of the year — the casual chef de partie on 168.5 hours in August, if August is a normal month for them — and for that person the prior question is usually whether their contract makes them an irregular-hours worker at all.
What is coming
The 12.07% method itself is settled law and is not waiting on anything. What is moving is enforcement.
The consultation closes 22 September 2026
GOV.UK published Make Work Pay: holiday pay compliance and enforcement on 30 June 2026, and it closes at 11:59pm on 22 September 2026. It sets out how the Fair Work Agency is to enforce statutory holiday pay from 2027, alongside the existing employment tribunal route rather than in place of it.
That change lands on top of a duty that is already live: since 6 April 2026 you have had to keep records adequate to show that holiday entitlement and holiday pay were right, and keep them for six years. The duty is written in terms of what the records have to demonstrate rather than which documents you have to hold, and it does not name the monthly accrual sum. But for an irregular-hours member of staff, the hours worked in each pay period and the accrual taken from them are the obvious way to be able to demonstrate it. We went through that duty in full in the six-year holiday records post.
What this means for how you keep the rota
Everything above runs off one number per person per pay period: hours actually worked. Not rostered, not contracted, not remembered — worked. Get that number wrong and every figure downstream of it is wrong in a way no amount of care later can fix.
Three questions worth asking of however you do it today:
- Can you produce hours worked, per person, for a pay period that has already closed? The accrual is fixed on the last day of that period. Reconstructing it in March from a paper diary is not the same thing as having it.
- Are you storing the accrued hours, or recalculating them? Rebuilding the figure from an annual total is a different calculation from the one regulation 15B specifies, and the two give different answers.
- Could you show the working for one person, for one month, two years from now? That is the shape of the question the records duty asks — and the shape of the question a member of staff asks when they think their holiday is short.
None of this needs software. It needs the hours to exist somewhere durable, tied to real people and real pay periods, and to still be there when somebody asks. If the rota already produces that as a by-product of running the venue, the sums above are a minute’s work each month rather than an afternoon’s archaeology.