Holiday Entitlement When Someone Leaves a Job

When someone leaves a job, their annual leave entitlement normally needs to be calculated up to their final date of employment.

They may be able to take remaining accrued holiday during their notice period. If statutory holiday is still unused when employment ends, the employer must pay it in lieu.

How is remaining holiday calculated?

The worker's entitlement depends on how much of the leave year has passed and how much holiday has accrued up to their leaving date.

GOV.UK provides a holiday entitlement calculator that employers can use when someone starts or leaves part way through a leave year.

Can an employee take holiday during their notice period?

They may be able to. Whether the leave can be taken depends on the normal request rules, whether the correct notice is given and whether the employer approves the dates.

An employer may also require a worker to take holiday before they leave if the proper notice rules are followed.

What happens to unused statutory holiday?

If statutory annual leave remains untaken when employment ends, it must be paid in lieu as part of final pay.

Acas confirms that employers must pay workers for any untaken statutory holiday entitlement they have accrued when they leave.

What if the employee has taken too much holiday?

An employee might have taken more annual leave than they had accrued by their final day.

An employer can only deduct the excess from final wages if the worker agreed to this beforehand in writing, for example through the employment contract.

What about holiday above the statutory minimum?

Some employers provide contractual holiday above the statutory entitlement. The contract can set separate rules for how that additional leave is treated when employment ends.

Record payments in lieu

From 6 April 2026, annual leave and holiday-pay record requirements include payments in lieu of holiday when someone leaves.

Employers must keep these records for at least 6 years from the date they were made.

Leaving employee holiday checklist

• Confirm the employee's final employment date.
• Calculate leave accrued to that date.
• Check holiday already taken.
• Check any approved leave during the notice period.
• Calculate remaining untaken statutory leave.
• Include any required payment in lieu in final pay.
• Only deduct excess leave if agreed beforehand in writing.
• Record the holiday and final payment accurately.

Keeping balances current throughout the year with leave management software can make the final calculation easier when an employee leaves.