Annual leave payments for regular overtime/additional hours
December 13, 2024
Over the past few years there have been a number of legal decisions that have shaped the law about how payments for annual leave should be calculated. These decisions prompted the national NHS Staff Council to consult with Trade Unions about how annual leave is calculated for staff employed within the NHS under Agenda for Change Terms and Conditions.
In 2021 they reached an agreement where, if certain criteria are met, annual leave payments should include an average of overtime worked, as well as basic pay. The agreement only covered the period April 2019 – March 2021 and was a corrective ‘one off’ payment.
In the absence of any agreed National methodology for calculating annual leave payments for April 2021 and beyond, a regional working group made up of local NHS organisations, agreed in principle that a multiplier of 14.54 per cent should be applied; this reduces the risk of underpayment as it was based on 33 days annual leave. The reasoning behind this is that many staff in the NHS will have 10 years’ service or more and it reduces the risk of under-payments.
The regional working group determined that the criteria be applied to any overtime or additional standard hours worked in at least six out of twelve months.
Our Staff Side colleagues have agreed that this principle be applied to all staff under Agenda for Change terms and conditions satisfying the above criteria and would be paid in a retrospective one-off payment going forward.
Staff receiving a payment will receive the amount via Payroll in December’s pay. This will be identified on payslips as ‘Ann Leave OT Cor Pay.’
The payment is non-consolidated and non-pensionable and will be subject to deductions for income tax and national insurance contributions and other usual deductions.
If you have any queries about calculation of the payment or the deductions made, please call the Payroll Department on 0121 507 6655 option 1. If you feel that you should have been paid an amount under this criteria, then you will need to raise this with your line Manager who will be able to source evidence for this and progress any potential payment via Payroll.