Holiday calculation

Should holiday pay for a term-time worker with a year-round contract (a ‘part-year worker’) be calculated as 12.07% of their annual earnings?

Harpur Trust v Brazel is the Supreme Court case that made it clear employers CANNOT use the 12.07% method to calculate holiday pay under the Working Time Regulations and s224 Employment Rights Act 1996.

The correct method of calculation of weekly pay for a ‘part-year worker’ is as set out in s224 Employment Rights Act 1996. Weekly pay should be calculated as an average of the most recent 12 weeks’ of earnings, ignoring any weeks where earnings were zero (e.g. school holidays in this case).