Glossary

Target Working Hours

Target working hours (or contracted working hours) represent the contractually agreed hours an employee is required to work over a given period, serving as the benchmark against which actual hours worked are measured.

Calculation & Derivation

Under Section 1 of the Employment Rights Act 1996 (ERA 1996), employers must specify contracted hours of work in the written statement of employment particulars. The agreed weekly working hours and the respective working pattern determine the daily target hours:

  • For a 40-hour week distributed evenly across five days, the daily target is 8 hours per working day.
  • For a 30-hour week distributed across four days, the daily target is 7.5 hours per scheduled day.

These figures establish the baseline against which actual hours worked are tracked, ensuring compliance with the 48-hour average weekly limit set by the Working Time Regulations 1998 (WTR 1998) and supporting accurate calculation of National Minimum Wage compliance.

Common Pitfalls & Edge Cases

  • Bank holidays and public holidays: If an employee is entitled to paid time off on bank holidays (either under the contract or as part of their 5.6-week statutory annual leave entitlement under Regulations 13 & 13A of the WTR 1998), the daily target working hours should be reduced to zero without creating a negative time balance. Because bank holidays can differ across the UK (England and Wales, Scotland, and Northern Ireland), the time tracking software must align with the employee's specific jurisdiction.
  • Annual leave and statutory sick leave: Authorised absences (including statutory annual leave and sick leave covered by Statutory Sick Pay / SSP) reduce the target working hours in the exact same manner. In working time account systems, target hours for approved leave days are treated as credited hours to avoid inaccurate deficits.
  • Part-time work with variable working patterns: Part-time employees on non-standard working schedules require distinct daily target values rather than a crude weekly average. Otherwise, an employee working longer shifts on designated days would appear to generate artificial overtime or deficits.
  • Mid-year contract variations or schedule changes: Any formal change to contracted hours under Section 4 ERA 1996 requires an unambiguous cut-off date to ensure previous and revised target working hours are not retroactively conflated.

Practical Significance

Almost every workplace dispute regarding overtime, time off in lieu (TOIL), or unlawful deductions from wages under Section 13 ERA 1996 fundamentally stems from discrepancies in target working hours versus actual hours worked.

Employers who document, calculate, and track target hours transparently—incorporating contract terms, jurisdiction-specific public holidays, and statutory absence rules—safeguard compliance with the Working Time Regulations 1998, HMRC National Minimum Wage enforcement, and prevent employment tribunal disputes.

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Related terms

Glossary

Actual Working Time

Actual working time comprises the hours a worker is genuinely working at the employer's disposal, after deducting statutory and contractual rest breaks.

Glossary

Time Balance

The time balance is the net difference between actual hours worked and contractual target hours. A positive balance represents accrued time credit, whilst a negative balance indicates a time deficit (undertime).

Glossary

Overtime

Overtime refers to hours worked beyond the contractually agreed standard working hours. It must be remunerated or compensated with time off in lieu (TOIL) in accordance with the employment contract and statutory minimum wage requirements.

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