Holiday pay and holiday days for your staff: the rules
Written by Ilias Aarrass5 min read · Published on · Last reviewed on 
In short
An employee is entitled to at least 8 per cent holiday pay on gross wages, paid at least once a year, and to statutory leave of four times the weekly working hours. Statutory days expire six months after the year of accrual; extra-statutory days lapse after five years.
- Holiday pay is at least 8 per cent of gross wages, including overtime.
- Statutory leave is four times the weekly hours.
- An employee also accrues statutory leave hours during illness.
- Statutory days from 2026 expire on 1 July 2027, unless agreed otherwise.
When you take on staff, every employee accrues holiday pay and holiday days from the first working day. These are statutory rights: you cannot go below them in the employment contract. For your records it means you build up an obligation each month that you only pay out later. Without a reserve, May brings a nasty surprise. This article explains the minimum leave and holiday pay, how it works with illness and part-time staff, when days expire and how to put the accrual properly in your books.
Holiday pay: at least 8 per cent
Your employee is entitled to at least 8 per cent of the gross wages earned over the past year. Overtime counts, including any premium. Profit shares and similar one-off payments do not. You pay it at least once a year; most employers do so in May or June. You may also pay monthly if that is agreed in the employment contract or cao (collective labour agreement).
If someone earns more than three times the minimum wage, you may agree in writing on lower holiday pay or none at all. With ordinary salaries in a small business this rarely applies.
Worked example: holiday pay reserve
- Gross salary
- 2,800 euros per month
- 8 per cent reserve
- 224 euros per month
- Twelve months
- 2,688 euros
Result: In May you pay out 2,688 euros gross holiday pay. If you reserved 224 euros each month, the money is ready and your monthly figures already show it as a cost.
Holiday days: four times the working week
By law an employee gets four times their weekly hours in leave each year. Anything above that is called extra-statutory and is agreed in the employment contract or cao. For an on-call worker you use the average hours per week.
| Hours per week | Statutory leave hours | In 8-hour days |
|---|---|---|
| 40 | 160 | 20 |
| 32 | 128 | 16 |
| 24 | 96 | 12 |
Illness, expiry and paying out
During illness your employee keeps accruing statutory leave hours. For extra-statutory days the cao or contract may say otherwise. Holiday pay for that period is calculated on the wages you actually continue to pay.
- Statutory days expire six months after the year in which they were accrued: days from 2026 expire on 1 July 2027, unless you agree a longer period.
- If your employee reasonably could not take the days, for example due to illness, they only lapse after five years.
- Extra-statutory days lapse after five years.
- Statutory days may not be paid out during employment; extra-statutory days may. When employment ends you pay out all remaining days.
How to book it in your records
Add a balance sheet account 'holiday pay reserve' to your chart of accounts. Each month you book 8 per cent of gross wages as a cost against that reserve; on payment you reduce the reserve by that amount. Your payroll software usually makes this entry automatically with the payroll tax return.
At year end you record unused holiday days as a liability, valued at the hourly wage. This is part of the accruals and deferrals in your year-end close and ensures the costs fall in the right year.
Keep a balance per employee of hours accrued and taken. That prevents disputes on departure and gives you the number of hours for the balance sheet liability straight away at year end.
Frequently asked questions
Can I include holiday pay in the monthly salary?
Yes, if you agree on it clearly and show it separately on the payslip. A fixed all-in amount without specification is risky.
Does a part-timer accrue the same number of days?
Pro rata: always four times the weekly working hours. Someone working 24 hours gets 96 statutory leave hours.
Must I pay out holiday days when someone leaves?
Yes. When employment ends you pay out all unused days in the final settlement.
Sources
- How much holiday pay do I get?Rijksoverheid · rijksoverheid.nl
- Holiday days for employeesOndernemersplein · ondernemersplein.overheid.nl
Sources checked on
This article provides general information based on the rules known for 2026 and does not replace personal tax advice. For your specific situation, we're happy to take a look with you.
