May is the month in which most people traditionally receive their holiday pay. Working people with a monthly income of up to 3,000 euros gross will receive more holiday pay this year. But those who earn average or more receive less.
The amount of holiday pay depends on a person’s income. Anyone who earns more than the average (3,395 euros gross per month) will receive less money in 2024 than last year. Paycheck processor ADP listed it for RTL News.
A part-time employee with a gross monthly salary of 1,750 euros will receive 578 euros more holiday pay this year. Anyone with an average income of 3,395 euros gross per month will lose 19 euros compared to last year.
People with twice the average income (6,790 gross per month) receive as much as last year. The big loser, however, is the employee with a three times average income (a gross monthly salary of 10,185 euros) – who receives 637 euros less holiday pay than last year.
Less holiday pay from average
Why do you get less holiday pay from an average salary? This is due to the so-called income-related tax credit. Put simply: the higher your income, the more tax you pay on your holiday pay.
Workers in the highest income scales will pay 56.01 percent tax this year, while that was still 49.5 percent in 2023. Hence the decline.
Minimum wage
On January 1 of this year, the statutory minimum wage increased considerably. Nevertheless, an employee with the minimum wage and a 36-hour working week will receive 15 euros less holiday pay this year than last year.
Minimum wage earners who work 38 or 40 hours a week do make net improvements. They receive 12 and 40 euros more holiday pay respectively.
According to Dik van Leeuwerden, manager at ADP, the lower holiday pay can be a downer for people. But if you look at the salary slip for the entire year, there is also good news.
“If you look at the periodic increase at the beginning of the year, all working people will benefit financially. So there will be more left in 2024, even though you may receive less holiday pay.”
