Understanding Your Final Paycheck
When you leave a job in the UK, your final paycheck is the last payment your employer owes you for your work. This payment is important because it ensures you receive everything you are entitled to, including any outstanding wages, unused holiday pay, and other owed amounts. Understanding what should be included in your final paycheck helps protect your rights and avoid disputes with your employer.
What is a final paycheck? A final paycheck is the last sum of money your employer pays you when your employment ends, whether you leave voluntarily, are made redundant, or are dismissed. This payment covers all earnings up to your final working day and may include other amounts you are owed.
What payments are included in a final paycheck? Typically, your final paycheck should include:
Outstanding wages: Any unpaid salary or hourly pay for the work you’ve completed up to your leaving date.
Accrued holiday pay: Payment for any untaken statutory holiday you’ve built up but haven’t used. Under the Employment Rights Act 1996, you are entitled to be paid for any unused holiday entitlement.
Bonuses and commission: If your contract entitles you to bonuses or commission, and you have earned them before leaving, these should be included.
Other payments: This might include overtime, expenses, or other contractual payments owed to you.
Your employer must provide a payslip for your final paycheck, detailing how the payment has been calculated and any deductions made (such as tax and National Insurance).
Why is it important to know your rights? Knowing what you are entitled to in your final paycheck helps you spot any mistakes or missing payments. If your employer fails to pay you correctly or withholds your final pay, you have the right to challenge this. Understanding your rights also means you can plan your finances and ensure a smoother transition to your next role or situation.
If you believe your final paycheck is incorrect or you haven’t received it, you should first raise the issue with your employer. If the problem isn’t resolved, you may have the right to take further action, such as making a claim to an employment tribunal.
For a more complete overview of your entitlements when it comes to pay, including issues like minimum wage, sick pay, and deductions, visit our Payment Rights page. This will help you understand your rights as an employee and what steps to take if you encounter problems with pay at any stage of employment.
What Should Be Included in Your Final Paycheck?
When you leave a job in the UK, your final paycheck should cover everything you are owed up to your last working day. Understanding exactly what should be included can help you spot any missing payments or incorrect deductions. Here’s what you should expect:
Wages Owed Up to Your Last Day
Your employer must pay you for all the hours you worked up to your official leaving date. This includes your basic salary or hourly wage, as well as any overtime you have completed but not yet been paid for. The payment should be calculated according to your contract and the hours you actually worked.
Payment for Unused Holiday Entitlement
If you have any unused statutory holiday entitlement when you leave, you are legally entitled to be paid for these days. This is known as holiday pay. Under the Working Time Regulations 1998, you should receive payment for any accrued but untaken holiday, calculated up to your leaving date. For example, if you leave halfway through the holiday year and haven’t taken all your leave, your employer must pay you for the remaining days you’ve earned.
Other Payments: Bonuses, Commissions, and Benefits
Depending on your employment contract, your final paycheck may also include other payments such as:
Bonuses: If you are due a bonus that relates to work done before you left, this should be included, unless your contract states otherwise.
Commissions: Any commission earned up to your last day should be paid, even if the payment would usually come later.
Owed Benefits: This can include things like expenses you’ve claimed, or other allowances specified in your contract.
Check your employment contract or staff handbook for details about these payments and when they are due.
Deductions from Your Final Pay
Employers can only make certain deductions from your final paycheck if they are legally allowed or if you have agreed to them in writing. Common legal deductions include:
Tax and National Insurance: These are deducted as usual.
Pension Contributions: If you are enrolled in a workplace pension, contributions will be taken as normal.
Other Agreed Deductions: For example, repayment of a season ticket loan, or the cost of unreturned company property, but only if this is clearly stated in your contract.
Employers cannot make deductions for things like training costs or damages unless you have agreed to this in advance and it is reasonable.
Check Your Payslip Carefully
Your final payslip should clearly show all payments and deductions, making it easier to understand how your final pay has been calculated. It’s a good idea to compare your final payslip with your contract and any recent communications from your employer. If you’re unsure how to read your payslip or what the different items mean, see our guide to payslips for a detailed breakdown.
If you believe something is missing or incorrect in your final paycheck, raise it with your employer as soon as possible. Keeping records of your hours worked, holiday entitlement, and any correspondence can help resolve any issues quickly.
Timing of Your Final Paycheck
When you leave a job in the UK, whether you resign, are made redundant, or are dismissed, you are entitled to receive your final paycheck promptly. Understanding when you should expect your last wages and what to do if there’s a delay can help you plan your finances and protect your rights.
There is no single law in the UK that sets a specific deadline for paying your final wages. However, your employer must pay you all the money you are owed on your usual payday for the last pay period you worked. This is set out in your employment contract and supported by the Employment Rights Act 1996, which requires employers to pay all wages due for work carried out.
For example, if you are normally paid monthly and you leave part-way through the month, you should receive your final wages on the next scheduled payday. Your final paycheck should include all outstanding pay up to your leaving date, as well as any accrued but untaken holiday pay and other owed payments such as bonuses or commission, if applicable.
Your final wages are usually paid using the same method as your regular pay—most commonly by bank transfer (BACS). Some employers may issue a cheque or, in rare cases, pay in cash, but this is less common. You should also receive a payslip detailing how your final pay has been calculated, showing any deductions for tax, National Insurance, and other agreed deductions.
If your employer does not pay your final wages on time, they are in breach of contract. A delayed payment may also be considered an unlawful deduction from wages under the Employment Rights Act 1996. If this happens, you should first contact your employer or payroll department to ask when your final pay will be processed. Sometimes delays occur due to administrative errors or payroll cut-off dates.
If you do not receive a clear answer or your pay is still not received, you can raise a formal grievance with your employer. If the issue remains unresolved, you may be able to make a claim to an employment tribunal for unpaid wages. There are time limits for making such claims, typically three months less one day from the date the payment was due.
Before leaving your job, check your employment contract or staff handbook for any specific terms about final payments. Some employers may have policies stating that final pay will be processed in the next payroll run after your leaving date, while others may pay as soon as possible after your last working day.
It’s a good idea to ask your manager or HR department to confirm in writing when you will receive your final paycheck and what it will include. Keep copies of all correspondence and make a note of any discussions about your pay.
If you are unsure about your rights or your employer’s obligations, you can seek advice from an employment adviser or trade union representative. Being proactive can help ensure you receive everything you are owed without unnecessary delays.
Holiday Pay in Your Final Paycheck
When you leave a job in the UK, your employer must include any unused holiday pay in your final paycheck. This payment is a legal right, ensuring you are compensated for any holiday entitlement you have earned but not taken by your leaving date.
Your holiday pay is based on your statutory or contractual holiday entitlement. By law, most workers are entitled to a minimum of 5.6 weeks’ paid holiday per year under the Working Time Regulations 1998. If you work part-time, your entitlement is calculated on a pro-rata basis.
When you leave a job, your employer calculates how much holiday you have accrued up to your last working day. If you have taken less than your entitlement, you should be paid for the remaining days. For example, if you are entitled to 28 days per year and leave halfway through the year, you would be entitled to 14 days. If you have only taken 10 days, you should be paid for the remaining 4 days.
Holiday pay should be based on your normal rate of pay. For those with variable hours or pay, your holiday pay is usually calculated as an average of your pay over the previous 52 weeks in which you received pay.
There are two types of holiday entitlement:
Statutory holiday entitlement: This is the minimum amount of paid holiday set out by law (currently 5.6 weeks per year).
Contractual holiday entitlement: Some employers offer more than the statutory minimum. Your employment contract should set out your full entitlement.
When calculating your final holiday pay, your employer should use the higher amount if your contract gives you more than the statutory minimum. However, any extra contractual holiday may be subject to different rules, so check your contract for details.
If your final paycheck does not include your holiday pay, or if you believe the amount is wrong, take these steps:
Check your payslip and contract: Make sure you understand how your holiday pay has been calculated.
Raise the issue with your employer: Contact your former employer or HR department to discuss the discrepancy. Mistakes can often be resolved quickly.
Put your complaint in writing: If the issue isn’t resolved informally, write a formal letter or email outlining your concerns and what you believe you are owed.
Seek further advice: If your employer still does not pay what you are owed, you may be able to make a claim to an employment tribunal. There are strict time limits for making a claim, usually three months less one day from the date you should have been paid.
Your final paycheck should include all outstanding payments, including:
Wages for any work completed up to your leaving date
Payment for any untaken statutory or contractual holiday
Any other owed payments, such as bonuses or expenses, if applicable
It is unlawful for your employer to withhold your holiday pay. If you have taken more holiday than you have accrued, your employer may deduct the overpayment from your final wages, but only if your contract allows this.
Understanding your rights to holiday pay ensures you receive everything you are owed when leaving a job. If you have concerns or questions, reviewing your contract and payslips is a good starting point.
If You Don’t Receive Your Full Final Pay
If you don’t receive your full final paycheck when leaving a job, it’s important to know your rights and the steps you can take to resolve the issue. In the UK, your employer is legally required to pay all wages owed to you, including any outstanding holiday pay, up to your final working day. This is set out under the Employment Rights Act 1996.
1. Check Your Payslip and Contract Start by reviewing your final payslip and employment contract. Make sure you understand what payments you are owed, such as basic wages, overtime, and unused holiday entitlement. Sometimes, deductions or mistakes can occur, so double-check the figures.
2. Raise the Issue Informally Often, payment problems are due to administrative errors. Contact your employer or payroll department as soon as possible. Explain clearly which payments you believe are missing and ask for a breakdown if anything is unclear. It’s best to do this in writing (such as by email) so you have a record of your communication.
3. Escalate the Matter Formally If your employer does not resolve the issue informally, you can raise a formal grievance following your company’s grievance procedure. Set out what you believe you are owed and include any evidence, such as payslips or your contract.
4. Seek External Advice If you’re unable to resolve the matter directly with your employer, you can get free, confidential advice from ACAS (the Advisory, Conciliation and Arbitration Service). ACAS can help mediate between you and your employer, and explain your options.
5. Make a Claim to an Employment Tribunal If all else fails, you have the right to make a claim to an employment tribunal for unpaid wages. You must usually do this within three months less one day from the date you should have been paid. The tribunal can order your employer to pay what you are owed, plus any applicable compensation.
Problems with your final paycheck often overlap with other payment issues. If your employer has failed to pay you for work you have done—whether as part of your final pay or during your employment—you may also want to read about unpaid wages. Similarly, if there are payments owed from previous periods, such as overtime or pay rises not applied on time, information on backdated pay may be helpful.
Keep copies of all correspondence with your employer.
Gather evidence, such as contracts, payslips, and bank statements.
Act promptly, as there are strict time limits for making claims.
Not receiving your full final pay can be stressful, but understanding your rights and following these steps will help you resolve the issue as quickly as possible.
Related Topics to Explore
When it comes to understanding your final paycheck rights, it’s helpful to explore related areas of pay and employment law. Each of the topics below covers important aspects of your rights at work, helping you get a complete picture of what you’re entitled to and what you can do if something goes wrong.
Payslips: Your payslip is an essential record of your earnings, deductions, and overall pay. By law, employers must provide a payslip every time you are paid, including your final paycheck. Learn what information should be included and how to check for errors.
Backdated Pay: If you’re owed money from previous pay periods—perhaps due to missed overtime or delayed wage increases—this is known as backdated pay. Find out your rights to claim these amounts and the steps to take if your employer hasn’t paid you what you’re owed.
Minimum Wage: UK law sets a minimum hourly rate for most workers, as outlined in the National Minimum Wage Act 1998 and the National Living Wage. Discover how to check if you’ve been paid correctly, especially in your final pay, and what to do if you think you’ve been underpaid.
Unpaid Wages: If you haven’t received wages you’re owed—including your final paycheck—there are clear steps you can take. This topic explains how to raise the issue with your employer, escalate your complaint, and what legal protections exist to help you recover your pay.
Pay Cuts: Employers can’t simply reduce your pay without following the correct process and seeking your agreement. Learn about your rights if your pay is cut, what consultation should happen, and what to do if you disagree with a reduction.
Fair Wages: Beyond the legal minimum, you have a right to fair pay for your work. This topic explores what “fair wages” means in practice, how it’s determined, and what to do if you believe your pay doesn’t reflect your role or responsibilities.
Exploring these topics will give you a stronger understanding of your payment rights, whether you’re starting a new job, leaving your current one, or facing issues with your pay. Knowing your rights under UK employment law can help you take action confidently if problems arise.
