Alexa Besnard
2 minutes length
Posted: 25th November 2019

Are you fully prepared for the holiday pay law changes in April?

A number of employment law changes, including some relating to holiday pay, are set to come into effect in April 2020.

But did you know? And if so, are you fully prepared for what you need to do on the payroll front?

You wouldn’t be alone if you weren’t aware. And, as a small business, with so many things to handle, it wouldn’t be surprising.

According to a survey by OnePoll, as many as 59 percent of British employers do not even know about the changes, which come from the Government’s Good Work Plan.

And of the decision-makers at British businesses who had heard of the Good Work Plan, 42 percent only had a partial understanding of how it would affect them.

Experts have warned the changes will affect all businesses and in the most extreme cases they could face penalties of up to £20,000 at employment tribunals for failing to comply.

The legislative changes have arisen from recommendations by Matthew Taylor, who was commissioned by former Prime Minister Theresa May to review the labour market.

The Government pledged to legislate to extend the Holiday Pay reference period from 12 to 52 weeks. This is due to come into effect on 6 April 2020.

Analysts have pointed out that in future there will be a state-led enforcement regime to assist vulnerable workers when an employer does not pay holiday pay correctly, whereas now, it’s up to the individual to bring proceedings.

Sound complicated and daunting?

That’s just a little of what the new holiday pay legislation is going to bring, without even mentioning the existing rules surrounding the EU Working Time Directive and the UK Working Time Regulations, which apply to all workers, not just employees. This includes agency workers and non-employed trainees.

How can I keep up with all this compliance change?

Luckily, at KashFlow Payroll, we have all of this covered. We are constantly updating our software to ensure that all of these matters are taken care of and you don’t have to worry.

And things have got even better with our new KashFlow Payroll Holiday Pay Module. This contains the following features and benefits:

  • Automatically calculates and pays holiday pay based on calendar entries
  • Caters for accrual style holidays
  • Covers hourly, daily and weekly holiday pay
  • Allows employers to reset holiday schemes at any point throughout the year
  • Employer can choose which pay period they want the holiday pay to be paid in
  • Holiday pay can still be manually added to a payslip

Want to understand more about it? Let one of our team call you by registering your interest here.