The Bank Holiday Conundrum – A Timely Challenge for UK Employers

Are Pro-Rated Holiday Allowances Fair?

As we move through the cluster of spring bank holidays, between Easter and the May bank holidays, many UK employers are once again confronted with a familiar but often overlooked issue: do pro-rated holiday allowances for part-time workers truly deliver fairness?

For organisations operating a holiday year from April to March, the answer is increasingly complicated.

The Hidden Problem with “Simple” Pro-Rating

At first glance, pro-rating annual leave for part-time employees seems straightforward. A reduced working pattern means a reduced entitlement, typically calculated as a proportion of a full-time allowance, inclusive of bank holidays.

However, the reality is less balanced. Because bank holidays fall on fixed weekdays, part-time employees who do not work those days can be disadvantaged, while those who do may benefit disproportionately.

For example:

• A part-time employee who works Mondays may receive a higher share of paid bank holidays.
• Another who works Wednesdays to Fridays may receive less.

Over the course of a year, this can create unintended inequity between employees on similar hours but different working patterns.

Why 2026–2028 Makes This More Visible

Timing matters—and the upcoming holiday years highlight the issue starkly for an employer whose holiday year is April – March.

• In the 2026–2027 holiday year, there will be 10 bank holidays in England and Wales.
• In contrast, 2027–2028 will only have 6 within the same April–March framework.

This variation is driven by how Easter falls in the calendar. In 2027, Easter occurs in March, pulling Good Friday and Easter Monday into the 2026-2027 holiday year. The result is a significant swing in the number of bank holidays included within a single leave cycle.

For part-time employees, this creates a “postcode lottery” effect:

• Some may receive a higher proportion of their entitlement as fixed bank holidays.
• Others may see fewer bank holidays fall on their working days, effectively reducing their usable leave.

The Risk for Employers

Beyond fairness, there are practical and legal considerations:

• Employee engagement: Perceived inequity can damage morale and trust.
• Indirect discrimination risk: Working patterns often correlate with protected characteristics (e.g. part-time roles and gender), increasing legal exposure.
• Administrative complexity: Inconsistent approaches across teams can lead to confusion and errors.

A More Equitable Approach

Common solutions include:

Bank holidays included in a single annual leave pot

• Employees receive a total number of days including bank holidays, such that if a bank holiday falls on an employee’s ‘normal working day’ and the business is closed, that day will be deducted as a ‘holiday-day’

Pro-rating in hours, not days

• Calculating entitlement in hours allows for greater precision and fairness across varied working patterns.

Adjusting for actual bank holiday occurrence

• Some organisations review entitlements annually to reflect how bank holidays actually fall within that leave year and communicate definitive entitlement each year.

A Good Time to Review

With the variability between the 2026–2027 and 2027–2028 holiday years, now is an ideal moment for employers to review their approach.

Ask yourself:

• Does your current policy treat part-time employees consistently?
• Are you inadvertently advantaging or disadvantaging certain working patterns?
• Is your approach clear, transparent, and easy to administer?

Final Thoughts

Pro-rating annual leave may seem like a technical exercise, but it is deeply impactful. As workforce flexibility continues to grow, ensuring fairness in how leave is allocated is not just good practice – it’s essential.

A proactive review now could prevent confusion, complaints, and compliance risks later.