What's covered in this guide?:
Automated Leave Averaging Overview
UK legislation requires employers to use a 52-week reference period to average the cost and hours for employees who receive variable pay or work irregular hours.
Automated Leave Averaging in Workforce uses timesheet data to calculate average hours and costs automatically for leave requests.
Workforce checks up to 104 weeks of data to find applicable weeks.
At least 52 applicable weeks are used (or fewer, if the employee hasn’t worked that many).
This process is known as the Holiday Reference Period.
👉 For more details on the law, see:
Set Up Automated Leave Averaging
To set up Automated Leave Averaging:
Go to Leave > Leave Types.
Create a new leave type or edit an existing one.
Under 2. Costing Configuration, enable the setting for hours and cost averaging.
Save your changes.
Once configured, the system will automatically calculate averages when:
A leave request is submitted manually.
A leave request is generated automatically (e.g., bank holidays).
Past shifts or leave requests are updated and affect averages.
Leave Averaging Calculations
Workforce looks back over the last 104 weeks of timesheets.
✅ Included: Worked weeks with recorded timesheets.
❌ Excluded:
Weeks where no work was performed.
Weeks before employment started.
Leave, overtime, and allowances.
How Leave Averaging Appears on Timesheets
Leave requests with automated averaging appear like normal requests.
Hours and costs reflect the employee’s average over the last 104 weeks.
Values may change until the leave date passes and all timesheets are locked and exported.
FAQ's
What is the Holiday Reference Period?
What is the Holiday Reference Period?
It is the number of weeks used for averaging. Workforce looks back up to 104 weeks but must use at least 52 applicable worked weeks (or the maximum available if fewer).
Which weeks are applicable in the holiday reference period?
Which weeks are applicable in the holiday reference period?
Any week the employee worked and did not take leave.
How are averages in the holiday reference period calculated?
How are averages in the holiday reference period calculated?
Timesheet data from the last 104 weeks is used. Workforce selects up to 52 applicable weeks to calculate average daily pay/hours, then applies this to the employee’s requested leave.
What if my employee was furloughed?
What if my employee was furloughed?
Furloughed weeks do not count as worked weeks.
Best practice: record furlough as a leave request so the system excludes it automatically.
Alternatively: manually deselect furlough weeks from the averaging table.
What about allowances (tips, commissions, bonuses)?
What about allowances (tips, commissions, bonuses)?
These are not directly included. Some employers calculate holiday pay as 12.07% of each hour/payment. Check legislation or consult ACAS/legal advisors for case-specific guidance.
Can I use Automated Leave Averaging with Leave in Days?
Can I use Automated Leave Averaging with Leave in Days?
No. Automated averaging and Leave in Days cannot be enabled on the same leave type.
Troubleshooting
Holiday Allowances
If holiday allowances don’t apply correctly:
Check if your allowance calculation is set to manual or automatic.
For automated settings, configure at 12.07% of hours/payment (if relevant).
If using multiple teams, set up separate allowances for accurate allocation.
Holiday Hours Exports
If holiday hours aren’t appearing:
Go to Time & Schedules > Compliance > Time Off Types > Holiday Hours.
Ensure the Holiday Hours type is set to Apply automatically.
Or choose Apply automatically only to selected holidays and specify them.
Check that all holidays are listed under Settings > General Settings > Holidays.
Remember: non-automatic holiday hours must be requested and approved before appearing in exports.