Can an employer refuse to give holiday pay on a zero hours contract?

No. Holiday pay is a legal right for all workers. An employer cannot legally exclude holiday pay from a zero hours contract or claim that the hourly rate already includes holiday. Rolled-up holiday pay (adding 12.07% to the hourly rate) was historically used but is now restricted — holiday pay should be paid when leave is taken, or on termination of the contract.

Are zero hours workers entitled to Statutory Sick Pay?

Zero hours workers may be entitled to Statutory Sick Pay (SSP) of £116.75 per week in 2025/26 if they meet the qualifying conditions: they earn at least the Lower Earnings Limit (£123/week on average) and have been off sick for more than 3 consecutive days. If hours are too low to meet the LEL threshold, SSP may not be payable.

What employment rights do zero hours workers have?

Zero hours workers are entitled to: National Minimum Wage for all hours worked, paid annual leave (5.6 weeks), rest breaks under Working Time Regulations, protection against unlawful discrimination, and protection from being penalised for working for other employers. They are not employees (in most cases) and do not have employment rights such as unfair dismissal protection unless they work regularly for a significant period.

How do zero hours workers claim Statutory Maternity Pay?

Statutory Maternity Pay (SMP) is payable to employees who have worked for the same employer for at least 26 weeks by the 15th week before the expected week of childbirth, and who earn at least the Lower Earnings Limit (£123/week on average). Many zero hours workers will not qualify for SMP but may qualify for Maternity Allowance from the Department for Work and Pensions.

What is the 52-week average pay calculation for holiday pay?

Add up pay in all weeks where you worked over the previous 52 calendar weeks (ignoring weeks with nil earnings, up to a maximum of 104 calendar weeks back). Divide total pay by the number of weeks with earnings to get weekly average pay. Holiday pay per week taken equals this average. This method was required from April 2020 by the Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018.

What happens to unused holiday pay at the end of a zero hours contract?

Accrued but unused holiday pay must be paid out when the contract ends. This includes any holiday hours accrued at 12.07% of hours worked that have not been taken as paid leave. The payment is calculated at the worker's average weekly pay rate based on the 52-week average. Failure to pay holiday pay on termination is an unlawful deduction from wages.

Do I need to declare zero hours income to HMRC?

Yes. All earnings from zero hours contracts are taxable income subject to income tax and National Insurance. If you work for multiple employers on zero hours contracts, each employer deducts tax via PAYE. If you earn below the personal allowance (£12,570) from all sources combined, you will typically pay no income tax — but you should still declare income if filing a Self Assessment return.

How is NI calculated for zero hours workers?

Employee NI is calculated per employer on earnings within each pay period. If you earn £200/week from one employer, NI is: 8% on earnings above the weekly primary threshold (£242/week in 2025/26). Below £242/week per employer, no employee NI is due. If you work for multiple employers, NI is calculated separately for each — you will not pay NI on combined income that crosses a threshold between employers.

Zero Hours Contract Pay Calculator 2025/26

Q: How is holiday pay calculated for zero hours workers?

From April 2020, holiday pay for workers with irregular hours is based on average pay over the last 52 weeks worked (ignoring weeks with no earnings). Add up total pay in all weeks where you worked over the last 52 calendar weeks, divide by the number of weeks with earnings, to get weekly average pay. Holiday pay per week = this weekly average.

Q: What is the 12.07% holiday accrual rate?

12.07% represents 5.6 weeks holiday as a proportion of the 46.4 weeks of work in a year (52 minus 5.6 = 46.4). For every hour worked, you accrue 12.07% of an hour as holiday. If you work 100 hours, you accrue 12.07 hours of holiday. This is the standard accrual method for zero hours and casual workers.

Q: What is the National Minimum Wage for zero hours workers?

Zero hours workers are entitled to the National Minimum Wage for their age group for all hours worked. In 2025/26: National Living Wage (age 21+) is £12.21/hour. Age 18–20: £10.00/hour. Age 16–17 and apprentices: £7.55/hour. The employer cannot pay less than NMW regardless of the type of contract.

Q: Can zero hours workers work for other employers?

Yes. Exclusivity clauses in zero hours contracts (which prevented workers from working for other employers) were banned in the UK from May 2015. Employers cannot enforce clauses that prevent zero hours workers from seeking work with other employers. Workers can work for multiple employers simultaneously on zero hours contracts.

Zero Hours Contract Pay & Holiday Calculator

Average weekly hours worked

Hourly rate (£)

Period of work (weeks)

Age group (for NMW check)

Total hours worked in period

Total earnings in period

Holiday hours accrued (12.07%)

Holiday weeks owed

Holiday pay owed (if not taken)

Weekly average pay

NMW compliance

Holiday accrual uses the statutory 12.07% method (5.6 weeks ÷ 46.4 weeks). Holiday pay rate is based on 52-week average earnings (weeks worked only). NMW check compares your hourly rate against the 2025/26 National Minimum Wage for your age group.

Your Rights on a Zero Hours Contract

You are entitled to the National Minimum Wage for all hours worked
You are entitled to 5.6 weeks paid annual leave — calculated as 12.07% of hours worked
You cannot be excluded from working for other employers (exclusivity clauses banned since 2015)
You may be entitled to Statutory Sick Pay if you earn above the Lower Earnings Limit (£123/week on average)
You are protected against unlawful discrimination regardless of contract type
Holiday pay must be paid at your average weekly earnings — it cannot legally be withheld

How Holiday Pay Works on Zero Hours Contracts

Zero hours workers have variable hours by definition, which makes holiday entitlement calculation different from salaried employees. The law changed in April 2020: holiday pay is now based on average earnings over the last 52 weeks worked (using only weeks where the worker earned something, up to 104 calendar weeks look-back).

The accrual rate of 12.07% derives from the statutory 5.6 weeks' holiday entitlement as a fraction of the total working year: 5.6 ÷ (52 − 5.6) = 5.6 ÷ 46.4 = 12.07%.

What is the 52-Week Average Pay Rule?

Under the Employment Rights (Amendment) Regulations 2018 (effective April 2020), holiday pay for workers with variable hours uses the average of the last 52 calendar weeks in which earnings were received. Weeks with nil earnings are excluded and the look-back extends back up to 104 calendar weeks to find 52 earning weeks.

If you have only worked 10 weeks for the employer, the average is calculated over those 10 weeks. The pay rate during holiday should match what you would have earned in an average working week.

National Minimum Wage Entitlement

Zero hours workers must receive at least the National Minimum Wage for every hour worked in 2025/26:

National Living Wage (age 21+): £12.21/hour
Age 18–20: £10.00/hour
Age 16–17 and Apprentices: £7.55/hour

If your employer is paying below NMW, you can report underpayment to HMRC via the confidential NMW complaint line (0800 917 2368) or via Gov.uk. HMRC can investigate and force back-payment for up to 6 years.

Rolled-Up Holiday Pay

Rolled-up holiday pay — adding a 12.07% premium to the hourly rate instead of paying separately during leave — is now restricted. The government's position (following a Supreme Court ruling) is that it should only be used for irregular hours workers and part-year workers. If holiday pay is rolled up, it must be clearly identified as such on payslips and cannot be used to avoid paying during actual leave periods.

Frequently Asked Questions

Do zero hours contract workers get holiday pay? +

Yes. All workers — including those on zero hours contracts — are entitled to 5.6 weeks of paid annual leave under the Working Time Regulations 1998. For zero hours workers, holiday entitlement accrues at 12.07% of hours worked.

How is holiday pay calculated for zero hours workers? +

From April 2020, holiday pay uses average earnings over the last 52 weeks worked (excluding nil-earnings weeks). Divide total pay in those 52 weeks by the number of weeks with earnings to get average weekly pay. This is the rate at which holiday is paid when taken.

What is the 12.07% holiday accrual rate? +

12.07% represents 5.6 weeks' holiday as a proportion of 46.4 working weeks (52 − 5.6). For every hour worked, you accrue 12.07% of an hour as holiday. Work 100 hours, accrue 12.07 holiday hours.

What is the National Minimum Wage for zero hours workers? +

Zero hours workers must receive at least NMW for all hours worked: National Living Wage (21+) £12.21/hour, Age 18–20 £10.00/hour, Age 16–17 and Apprentices £7.55/hour in 2025/26. The employer cannot pay less regardless of contract type.

Can an employer refuse holiday pay on a zero hours contract? +

No. Holiday pay is a statutory legal right. An employer cannot legally exclude holiday pay from a zero hours contract. Failure to pay holiday pay is an unlawful deduction from wages, which can be claimed at an Employment Tribunal.

Am I entitled to Statutory Sick Pay on a zero hours contract? +

You may be eligible for SSP (£116.75/week in 2025/26) if you earn at least the Lower Earnings Limit (£123/week on average) and have been off sick for more than 3 consecutive days. If your hours are too low to meet the LEL, SSP is not payable — but you may claim Employment Support Allowance instead.

Can zero hours workers work for other employers? +

Yes. Exclusivity clauses in zero hours contracts have been banned since May 2015. Employers cannot prevent zero hours workers from working for other employers. You can hold multiple zero hours contracts simultaneously.

Can I claim Universal Credit on a zero hours contract? +

Yes. Zero hours workers with low or variable earnings may be eligible for Universal Credit. UC is calculated monthly and adjusts with your earnings. Variable earnings are reported to DWP automatically via HMRC's Real Time Information system.

What happens to unused holiday pay when the contract ends? +

Accrued but untaken holiday pay must be paid out when the contract ends. The payment is at the worker's average weekly pay rate. Failure to pay is an unlawful deduction from wages, which can be claimed within 3 months at an Employment Tribunal.

How do I report NMW underpayment? +

Report underpayment of NMW to HMRC via the confidential helpline: 0800 917 2368, or online at Gov.uk/pay-and-work-rights. HMRC can investigate back up to 6 years. Named employers found in breach are published on Gov.uk. You can also pursue a claim at an Employment Tribunal for unlawful deduction of wages.

Do I pay tax and NI on a zero hours contract? +

Yes. Earnings from zero hours contracts are subject to income tax and National Insurance via PAYE in the same way as any other employment. If you earn below the personal allowance (£12,570) from all sources combined, you will typically pay no income tax. NI is assessed per employer per pay period based on earnings in that period.

What is rolled-up holiday pay? +

Rolled-up holiday pay means adding 12.07% to the hourly rate instead of paying holiday separately when taken. It is now restricted in the UK — following a Supreme Court ruling it should only be used for irregular hours or part-year workers, and must be clearly identified on payslips. It cannot be used to avoid paying during actual leave periods.