Set up Average Holiday Pay schemes
Average Holiday Pay If an Employee's work has no fixed or regular hours, their holiday pay will be based on the average pay they received over the previous 52 weeks (or a average based on the available number of weeks if less than the full 52. schemes define how average holiday If an Employee's work has no fixed or regular hours, their holiday pay will be based on the average pay they received over the previous 52 weeks (or a average based on the available number of weeks if less than the full 52. pay is calculated for employees. Multiple schemes can be created and assigned to different employees. There is not limit for how many schemes can be created.
Before starting a process in Staffology Payroll, it is important to make sure the right employer is selected.
To select the employer, check the name in the top menu. If the employer needs to be changed, select the current employer name, then select the relevant employer from Other Employers.
How to add an average holiday pay scheme:
To add Average Holiday Pay schemes:
- Go to Edit Details, then select Leave.
- Select Add Average Holiday Pay Scheme.
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Enter the required details and select the options that apply.
More guidance about each setting are in the Average Holiday Pay scheme settings section of this topic.
- To save the details, select Create.
- When a scheme has been created, it can be assigned to the relevant employees.
Average Holiday Pay scheme settings
The Scheme settings table displays each setting available for Average Holiday Pay schemes.
| Setting label | Description |
|---|---|
| Scheme Name | Enter a unique name for the scheme so it can be identified when applied to employees |
| Weeks for average calculations |
Defaults to 52 weeks. If required change the value to a different number of weeks.
For more information, go to Guide to average holiday pay |
| Use only paid weeks | When selected, only paid weeks are used for the average weekly earnings calculation. Unpaid weeks are not included. |
| Do not include periods where all payments are statutory |
When selected, periods where only statutory pay is present (such as Statutory Maternity Pay (SMP Statutory Maternity Pay is the pay an employer must give to female employees on maternity leave, for up to 39 weeks.), Statutory Sick Pay Statutory sick pay refers to the pay an employer must give you if you’re too ill to work. It’s paid to you by your employer for up to 28 weeks, based on certain eligibility criteria - the cost of SSP is no longer able to be recovered - SSP is no longer reported to HMRC on your EPS submissions (SSP Statutory sick pay refers to the pay an employer must give you if you’re too ill to work. It’s paid to you by your employer for up to 28 weeks, based on certain eligibility criteria - the cost of SSP is no longer able to be recovered - SSP is no longer reported to HMRC on your EPS submissions), or Statutory Adoption Pay (SAP SAP or Statutory Adoption Pay. If an employee is adopting a child with a partner, one of them may be entitled to SAP and the other may be entitled to Ordinary Statutory Paternity Pay (OSPP). SAP usually follows the same basis as SMP in terms of amounts of length of time.)) are excluded from the calculation. Only one exclusion option can be selected at a time.
For more information on how these options affect pay history and imports, go to Statutory pay exclusion options for average holiday pay. |
| Do not include periods that have a mix of normal and statutory payments |
When selected, any period containing statutory pay alongside normal pay is excluded. Only one exclusion option can be selected at a time.
For more information on how these options affect pay history and imports, go to Statutory pay exclusion options for average holiday pay. |
| Calculation in Hours / Days | Select Hours or Days to set how the enhanced rate is calculated. |
| Use NI'able pay |
When selected, all elements subject to National Insurance A system of contributions paid by workers and employers in the UK, which funds various state benefits, such as the State Pension and Jobseeker's Allowance. are used to calculate average earnings.
To choose the pay items included in the calculation, clear selection of Use NI'able pay and select the required pay code set from Paycode Set for Pay. |
| Use working pattern for hours calculation |
When selected, the working pattern is used to calculate average earnings. When not selected, a pay code set is required. |
| Use Hourly Rate (where average rate is lower than normal hourly rate) |
When selected, if the average holiday pay rate is lower than the normal hourly rate, the hourly rate is used instead.
If the average rate is higher than the hourly rate, the average rate is used. The hourly rate is only used when it is higher than the average holiday pay rate. |