Glossary · UK

What is Annualised Hours?

A contract that sets total working hours across a whole year rather than per week, letting employers vary the pattern with demand.

Full Definition

Annualised hours is a working arrangement where an employee's contractual hours are fixed as a total for the year -- for example 1,820 hours -- instead of a set number each week. The employer can then schedule more hours during busy periods and fewer when demand is low, often using a mix of rostered hours and 'reserve' hours called on at short notice. Pay is usually a fixed equal salary paid in twelve monthly instalments, smoothing income across the year regardless of how many hours are actually worked in a given month. In the UK such contracts must still comply with the Working Time Regulations, the National Minimum Wage and National Living Wage (GBP 12.71 per hour for those aged 21 and over in 2026/27), and statutory holiday entitlement. The model is common in manufacturing, utilities and education. Workers should confirm how overtime, reserve hours and holiday are treated, since averaging can obscure whether minimum-wage rates are genuinely met.