Rolled-Up Holiday Pay
Holiday pay (12.07% of gross wages) added to each payslip rather than held separately and paid when leave is taken.
Rolled-up holiday pay is the most common holiday pay model used by umbrella companies. Rather than accruing holiday entitlement in a pot and paying it out when you take time off, the umbrella adds 12.07% to your gross pay each period as an advance payment of your statutory holiday entitlement.
The 12.07% figure represents 5.6 weeks of paid holiday expressed as a fraction of the working year (5.6 ÷ 46.4 = 12.07%).
Following the Supreme Court ruling in Harpur Trust v Brazel [2022], rolled-up holiday pay was confirmed as permissible for variable-hours workers (which most umbrella contractors are), provided it is clearly identified on the payslip.
The practical implication: you receive slightly more in each payslip (because holiday pay is included), but you do not receive additional pay when you take time off. Budget accordingly — particularly for gaps between contracts.