Rules for calculating the reference period
67.Paragraph 28 sets out supplementary rules that feed into the calculation of the “reference period” which is part of the “sufficient hours in the UK” test at paragraph 9 and the “sufficient hours overseas” test at paragraph 14. Paragraph 28 sets out how certain days reduce the reference period, as required by step 3(b) within paragraphs 9(2) and 14(3). The days in question are days of annual, parenting or sick leave, non-working days embedded within a block of such leave, and days that are part of certain gaps between employments.
68.Sub-paragraph (2) of paragraph 28 sets out that the reference period may be reduced to take account of reasonable amounts of annual leave, parenting leave and absences from work at times during the period when P is on sick leave and cannot reasonably be expected to work. Reductions may also be made for non-working days embedded within each block of such leave.
69.Sub-paragraph (3) of paragraph 28 ensures that no day may reduce the reference period under paragraph 28 if it already reduces the reference period by virtue of being a “disregarded day”. So there is to be no reduction from the reference period for the types of leave set out in this paragraph in relation to any disregarded days, which are defined at sub-paragraph 9(2) of the “sufficient hours in the UK” test and at sub-paragraph 14(3) of the “sufficient hours overseas” test and which are deducted from the reference period by virtue of step 3(a) within those sub-paragraphs.
70.Sub-paragraph (4) of paragraph 28 sets out that the nature of P’s work and where P does the work will be relevant to what is considered to be ‘reasonable amounts’ of annual or parenting leave.
71.Sub-paragraph (5) of paragraph 28 sets out that non-working days will be considered to be “embedded within” a block of leave if there are three or more consecutive days of leave taken before and after the non-working days in question. The effect of these rules is that only non-working days that form part of a longer period of leave (such as a block of several months of maternity leave) reduce the reference period. Without this such non-working days would form part of the reference period and P would have to work longer hours in P’s working weeks to make up for them. But other non-working days (not embedded within a longer block of leave) are effectively part of P’s normal working week and so do form part of the reference period over which the 35-hour test is measured.
72.Sub-paragraph (6) of paragraph 28 sets out that a non-working day is defined as a day on which P is not normally expected to work for contractual reasons or as part of P’s normal pattern of work and is a day on which P does not in fact work.
73.Sub-paragraph (7) of paragraph 28 sets out that the total of reasonable amounts of annual leave, parenting leave and absences from work on sick leave are to be rounded down for the purposes of reductions to the reference period where those totals do not add up to a whole number of days.
74.Sub-paragraphs (8) and (9) of paragraph 28 provide that gaps between changes of P’s employment (during which time P does not work) may also be excluded from the reference period up to a total of 15 days for each change in employment, and subject to a maximum of 30 days in the tax year.
