UK Payroll - Holiday Pay Adjustment
Lot of employee are working overtime. Holiday should be paid adding the Holiday Pay Adjustment. This means that overtime, certain allowances and commission plans will be included in the first 20 days of leave taken in any holiday year. To put this simply, you should be no worse off financially by taking your holiday. So if you earn commissions, claim certain allowances or work overtime these will now be considered as part of your holiday pay adjustment payment. Every employer must calculate this manually, and errors may occur during the process. It would be fantastic if a formula could be added to Xero.
(Monthly pay ÷ hours worked in month) = average hourly pay
Average hourly pay x hours worked in week = weekly pay
I've attached an example.