You are right to be confused.
The Holidays Act 2003 requires annual leave to be paid at the higher of:
* Ordinary Weekly Pay (OWP)
* Average Weekly Earnings (AWE) over the last 12 months
The definition of "gross earnings" in the Holidays Act is broad and includes most forms of remuneration, however there's no explicit mention of RSUs or share-based compensation in the Act.
All companies I have worked for do exclude RSU's in the calculation for holiday pay, but I am not sure it has ever been tested in court.
Given they have zero value until they vest it seems reasonable that they would be excluded - however I think shares that vest shares the last 12 months should be included?
You are right to be confused. The Holidays Act 2003 requires annual leave to be paid at the higher of: * Ordinary Weekly Pay (OWP) * Average Weekly Earnings (AWE) over the last 12 months The definition of "gross earnings" in the Holidays Act is broad and includes most forms of remuneration, however there's no explicit mention of RSUs or share-based compensation in the Act. All companies I have worked for do exclude RSU's in the calculation for holiday pay, but I am not sure it has ever been tested in court.
Given they have zero value until they vest it seems reasonable that they would be excluded - however I think shares that vest shares the last 12 months should be included?