Understanding just how the Redundancy Payments Service (RPS) calculate holiday entitlement can be really quite confusing, especially when it comes to ‘Carry Over’ holidays.
The RPS have recently set out the details below on how these calculations are made, and so we hope this may provide some clarity:
The amount of ‘Carry Over’ holiday allowed when calculating the claimant’s entitlement to payments from the NIF will be limited to 1.6 x number of days per week the claimant works (up to a maximum of 8 days carry over), as follows:
- 1 day worked = 1.6 days maximum carry over
- 2 days = 3.2 days maximum carry over
- 3 days = 4.8 days maximum carry over
- 4 days = 6.4 days maximum carry over
- 5, 6 and 7 days worked = 8 days maximum carry over
Employees can carry over more holiday in excess of the 4 weeks they are legally obliged to take and in excess of their statutory holiday entitlement if they have a contract of employment that allows them to do so e.g. a 5 day week employee with an annual contractual entitlement of 35 days would take 4 weeks holiday (20 days) and carry over the remaining 15.
The RPS however will only recognise the carry over difference between 4 weeks and 5.6 weeks (i.e. 1.6) up to a maximum of 8 days. Any Holiday Pay Accrued owed in excess of the statutory limits will be a residual claim in the insolvency.
Further information on the above can be obtained by contacting the RPS directly.
Kind Regards
CFS Redundancy Payments