Holiday Pay Records: What UK Employers Must Do From April 2026

From 6 April 2026, UK employers must keep holiday pay and annual leave records for 6 years or face criminal penalties. Here's what small businesses need to know. Holiday Pay Records Are Now a Legal Requirement. Is Your Business Compliant?

Most small business owners had no idea this was coming. That's not negligence, it's just the reality of running a business while employment law changes around you.

From 6th  April 2026, a new legal duty came into force requiring UK employers to keep adequate records of workers' annual leave and holiday pay entitlements. The timing was largely unexpected, it hadn't featured in the government's previously published implementation timelines, which is exactly why so many businesses missed it.

What does the law actually require?

The new rules require employers to keep adequate records demonstrating compliance with the correct amount of annual leave, the correct payments for that leave, and any payment for unused statutory leave when a contract ends, including leave carried forward from the previous holiday year.

Records must be kept for at least six years from the date they were made, and employers must make sure their systems include all the information required by law, whether that's an online management system, a spreadsheet, or a payroll system.

Why this matters more than it sounds

This isn't a box-ticking exercise. Failure to maintain adequate records is a criminal offence, not just a civil violation — and the new Fair Work Agency has powers to inspect premises, interview workers, seize documents, and issue unlimited fines.

For small businesses, the particular risk area is variable and irregular hours workers. The focus is especially on ensuring casual and part-year workers receive the correct minimum paid holiday entitlement of 5.6 weeks per year, an area where calculations can become complex.

Three questions to ask yourself this week

Does your HR or payroll system record leave entitlement, not just days taken, but what each employee is actually entitled to?

Are holiday pay calculations documented, including variable elements like commission or bonuses?

Could you produce six years of that data if the Fair Work Agency asked to see it?

If you're not confident on all three, your business has a gap that needs closing.

What to do now

There is no requirement to recreate historical records prior to 6^th April 2026, but all records created from that date onward must meet the new standard, meaning employers should ensure existing systems are capable of supporting long-term retention and retrieval.

At Belma Consultancy, we help small businesses get compliant without the overwhelm. If you're not sure where your records stand, get in touch for a straightforward conversation about what needs to change.

📩 Contact Belinda here https://zcal.co/belmangena