PeopleXD provides automated tools to help you accurately calculate and process holiday pay based on your organisation's configuration and legal requirements.
How holiday pay calculations work
PeopleXD can automatically generate holiday pay timesheets in addition to regular salary payments, allowances, and timesheets transferred from the Workforce Management module.
The system generates two types of holiday pay timesheets:
Basic Holiday Pay (Standard Holiday Pay)
Enhanced Holiday Pay
⚠️ Important: This feature must be configured in your system before use. For complete configuration steps, refer to the Holiday Pay user guide.
Enhanced Holiday Pay vs Basic Holiday Pay
Holiday Pay in PeopleXD is calculated based on two distinct entitlements: Enhanced Holiday Pay and Basic Holiday Pay (Standard Holiday Pay).
Enhanced Holiday Pay is typically applied to statutory holiday entitlement, often the first 20 days of annual leave and can include additional pay elements beyond basic salary, such as overtime, commission, and travel-to-work payments.
Basic Holiday Pay (Standard Holiday Pay) is typically applied to non-statutory holiday entitlement and includes only core salary elements.
Your organisation can configure how Enhanced Holiday Pay is applied:
EU only rule: Enhanced rate applies to the first 20 days of annual leave only.
All annual leave: Enhanced rate applies to all holiday taken.
Custom cut-off: Enhanced rate applies up to a specified number of days.
Holiday pay by worker type
The type of holiday pay calculation depends on the worker's contract type:
Positive input (contract) workers
The system can generate additional timesheets for:
Standard Holiday Pay.
Enhanced Holiday Pay.
Salaried workers
The system can generate additional timesheets for:
Enhanced Holiday Pay only.
Salaried workers receive their basic pay regardless of whether they are working or on holiday, so only the enhanced elements need to be calculated separately.
Calculate holiday pay
When you run the holiday pay process, PeopleXD performs the following calculations automatically.
Step 1: Identify the retrospective period
Both Enhanced and Basic Holiday Pay calculations are based on the previous 52 weeks of payments to the employee.
The system works as follows:
The system looks back from the processing period's start date for the absence.
It captures the 52 weeks prior to this date.
Weeks with no payment are skipped, and the system extends the range to include 52 paid weeks.
This ensures the calculation reflects actual earnings over a full year.
Step 2: Calculate average rates
The system calculates two average rates, which are average basic rate and average enhanced rate.
Average basic rate
For average basic rates the system is :
Calculated over the 52-week retrospective period.
Reflects any rate changes within the period.
Based on basic pay elements only.
Average enhanced rate
For average enhanced rates the system is :
Calculated for pay codes marked for inclusion in Enhanced Holiday Pay.
Covers the same 52-week retrospective period.
Includes basic pay plus additional elements (overtime, commission, etc.).
Step 3: Determine the Enhanced Holiday Pay rate
The EHP rate is calculated as:
EHP rate = Average Enhanced Rate − Average Basic Rate
This represents the additional payment due on top of basic pay when an employee takes a holiday at the enhanced rate.
Step 4: Generate automatic timesheets
The system automatically generates timesheets in the current payroll period.
Basic Holiday Pay timesheet: Basic Rate x holiday hours or days.
Enhanced Holiday Pay timesheet: EHP Rate x holiday hours or days.
Run the holiday pay process
To generate holiday pay timesheets, follow the steps below.
Record annual leave. Depending on your organisation's process, this may be recorded in Payroll, People Management, or Workforce Management (WFM).
Run the Payroll Validation task. The Payroll Validation task must be completed before the generate holiday pay option becomes available.
To run this for the whole pay group, follow these steps.
Beside the relevant pay group, click the three dot icon.
Click Enhanced Holiday Pay.
To run this for an individual employee, follow these steps.
Click Employee then search for the relevant employee.
Beside the relevant employee, click View.
From the Actions drop-down menu, select Enhanced Holiday Pay.
Re-run the Payroll Validation task. The Payroll Validation task needs to be re-run once the holiday pay timesheets have been created.
Log files and reporting
Log file
The system generates a log file for each holiday pay processing run: Log file format: py_enhanced_hol_days_api.logXXXX
XXXX represents the pay group code (padded to four digits).
Example: the log file for Pay Group 20 would be py_enhanced_hol_days_api.log0020.
Holiday pay reporting in Insight
To view a detailed breakdown of how standard and enhanced holiday pay are calculated, create a holiday pay report using Insights. To do this, follow these steps.
From the dashboard menu, select Insight.
Click Actions then click Create Report
In the Name field, provide a name for the report.
Click OK.
From the Add drop-down menu select Column.
From the Filter Columns By View drop-down menu, select the Enhanced Holidays Pay (Pay) view.
In the Search field, search for the column you'd like to view on the report.
After you've finished adding the columns, click OK.
Click Actions then click View Mode.
Click Refresh Data and this will display the holiday pay data.
If no data is returning in the insight report, you will need to grant the user pay group access.
This report can show calculations for current or historical periods, allowing you to audit and verify holiday pay processing.
Key considerations
When working with Enhanced Holiday Pay, keep the following points in mind:
Retrospective period variations
The 52-week retrospective window may vary in length due to skipped unpaid weeks.
Rate changes
Pay rate changes within the 52-week retrospective period will affect the final Enhanced Holiday Pay calculation.
Full Time Equivalent (FTE) settings
Holiday calculations in PeopleXD are based on the FTE set on the contract record, not the work schedule alone.
Verify that the employee's contract FTE correctly matches their working hours to ensure accurate holiday calculations.
Incorrect FTE settings can result in incorrect holiday calculations.
Processing timing
Holiday pay must be processed after annual leave is recorded but before final payroll submission.
Allow sufficient time for validation tasks to complete.
For more information including example calculations and detailed configuration steps, refer to the Holiday Pay user guide.