Leave in weeks guide for employees
A summary of what you need to know
- Under the Holidays Act 2003, all employees must receive at least four weeks’ annual leave after 12 months of continuous employment.
- To date, most organisations have calculated this in units of hours – e.g. a full-time employee would have 160 hours of annual leave owed to them over a period of 12 months.
- To help employers clearly show they are complying with the Act, Smartly has moved to calculating annual leave in units of weeks – e.g. an employee will now see they have four weeks of annual leave owed to them.
How will annual leave balances look in my Smartly app and my payslips?
Every employee’s annual leave balance in the Smartly app and on their payslips is now shown in weeks. To reduce confusion, an approximate leave balance in hours will also be displayed. Examples shown below.
Do I still apply for leave in the same way?
Absolutely! The only difference is that you can now choose to take your leave in Hours, Days or Weeks. This can be useful if you don’t work regular hours or days, and you know how many days or weeks of leave you want to take, but not what this might mean in hours.
Any leave applied for in hours or days will be converted to a proportion of a week based on your work pattern at the time you take that leave. For example, if you work 30 hours per week and you apply for 6 hours of annual leave, your annual leave balance will reduce by (6÷30) 0.20 of a week.
My annual leave balance is fluctuating, am I still receiving the correct amount of leave I’m entitled to?
Your annual leave balance will fluctuate in hours only and will be because your hours and/or days of work vary from pay period to pay period. It’s important to note that your leave balance in hours/days is an approximation only, it is the leave balance in weeks that will always add to four weeks for every 12 months of consecutive employment you complete with your employer.
Below is an example of when this might occur
- The blue bars represent the total hours worked every week for a period of 12 months.
- Your annual leave balance in hours/days is calculated based on what an “average week” is as at the date of your payslip (the green line).
- Your average week is calculated over an agreed number of pay periods with your employer (in this example, it’s 4 weeks).
- While the green line fluctuates up and down depending on the hours worked in the last 4 weeks, the red line, which represents your leave balance in weeks, progressively increases over the 12 months.
- At the end of 12 months, you receive the correct entitlement of 4 weeks of total annual leave.
Another more detailed example is provided below with our employee, 'Joe'.
