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Annual Leave Myth Busters

The upcoming additional bank holiday for the Queen’s Platinum Jubilee has left some employers wondering what employees’ rights are for an additional day off, or extra payments if they’re working.  There are a lot of myths around annual leave and entitlements so read on to get the facts.

Q: Do employers have to give time off for bank holidays?

Employees do not have a statutory right to have bank holidays off.  Full-time employees are legally entitled to 5.6 weeks off a year, and some employers count this as 20 days leave + 8 days for bank holidays.  However, unless the contract of employment specifically states that bank holidays will be counted as part of the 5.6 weeks, it does not have to be included.

Q: Do we have to give employees an additional day off if an extra bank holiday is announced?

Not unless the contract of employment specifies that any additional bank holidays will be added to annual leave entitlements.  The employee will usually not be entitled if a contract refers to “the eight usual bank holidays” (or similar), or actually lists the eight bank holidays.

Q: Do we have to pay employees additional pay if they work on a bank holiday?

Employees are not entitled to additional payment unless this is specified in their contract of employment.

Q: An employee has built up a lot of holiday, can we pay them instead of allowing them to take the time off?

Employers must allow employees to take off a minimum of 5.6 weeks per year and should not pay them for this time.  Keeping track of who has booked holiday and reminding employees to book their annual leave can help to reduce any build-up of annual leave.

If the contract of employment allows, an employer may be able to make payment for holiday which is above the statutory minimum of 5.6 weeks.  Employees can be paid for holiday time if their employment is being terminated.  However, time off is essential for wellbeing, and so employers are encouraged to monitor holiday and encourage employees to book time when they have a lot of annual leave built up.

Q: Can employees carry over unused annual leave?

Employees have a legal right to take 5.6 weeks of annual leave per year and employers must ensure employees are not stopped from taking this.  If there is a workplace agreement in place, an employee may be able to carry over part of their 5.6 weeks of annual leave.

If the company offers additional holiday and the contract specifies that some carryover is allowed, employees can carry over holiday above the 5.6 weeks minimum.

Q: Do employees carry on accruing holiday while on sick leave/maternity/paternity leave?

Yes, employees do continue to accrue holiday.  This leave can be carried over to a future holiday year if it is not taken during the current holiday year. We would suggest getting advice when handling these annual leave calculations as there are some important points to be aware of when managing this.

Q: Do we have to pay accrued annual leave if an employee is dismissed for gross misconduct?

If an employee is dismissed, they must be paid in lieu for any untaken statutory holiday.  An employer may have a contractual clause that states that any holiday above the statutory entitlement will be forfeited in the case of dismissal but the basic entitlement of 5.6 weeks remains.

Q: Do employees accrue holiday during their probation period?

Yes, employees do accrue holiday from day one. Some employers will have rules in place meaning that new employees can only take as much annual leave as they have accrued.

Q: If an employee is ill during a period of annual leave, do they lose the holiday time anyway?

Employees can take sick leave and use the holiday days at another time.  Employees must report their illness to the company and the employer can set out how this information will be given.

Q: Do we have to allow employees to have time off whenever they choose?

Employers can refuse to approve leave requests unless the contract of employment contract provides otherwise.  Employers should have a clear policy on holiday requests (many companies work this on a “first-come, first-served” basis).  However, an employee should not be prevented from taking their entitlement across the year, even if they may not be able to have the specific dates that they were hoping for.

Q: Should employees be paid their basic salary during periods of annual leave or do we have to include other payments such as commission/overtime/on call payments?

Case law has established that pay during the first four weeks of annual leave should include other payments such as commission, overtime pay and call-out allowances.

Q: Can we force employees to take holiday at a specific time?

Yes, for most employees.  As long as the right amount of notice has been given, employers can require employees, who are not on sick leave or family leave, to take a certain time period off. 

If an employer decides to do this, they have to tell employees at least twice as many days before as the amount of days they need people to take.  For example, if they want to close for 5 days, they should tell everyone at least 10 days before.

Having a well-worded contract of employment and clear policies on annual leave makes all the difference when it comes to holiday entitlement.  Get in touch with View HR for a conversation on how we can help you to set this up appropriately.

We hope that you get to enjoy the Jubilee celebrations!