How to handle holiday requests post Covid

With regulations amended in the wake of the pandemic allowing annual leave to be carried forward, Helena Rosenstein outlines best practice for employers managing their workforce

With lockdown restrictions lifting further as summer approaches, many employers are grappling with a range of practical issues relating to annual leave. 

The Working Time Regulations 1998 set out that all workers (including employees) are entitled to a minimum of 5.6 weeks of paid annual leave. The regulations implement the Working Time Directive, under which the minimum paid leave entitlement is four weeks. 

In normal circumstances, employers are obliged to allow their workers to take this within each leave year unless they are unable to because of sickness or statutory leave such as maternity leave. In those circumstances, leave is carried over to the next leave year. However, the last year or so has been anything but ‘normal’ and, in anticipation of this, the government amended the regulations in March 2020 to permit employees to carry over up to four weeks of holiday into the next two years of annual leave. This only applies to leave where it was not ‘reasonably practicable’ to take because of Covid; for example, where the worker was ill, self-isolating or asked to continue working as a result of the demands of Covid, such as frontline health care workers or supermarket staff.

Having said this, there will be many workers who had holidays cancelled because of the virus or who didn’t want to take leave if they couldn't travel, even in the UK. This is arguably not covered by the amended regulations as they could still have taken a break from work. But employers might want to consider allowing them to carry over at least part of their accrued leave as a gesture of goodwill to acknowledge the efforts of staff in trying circumstances. 

Overall, the aim of the amendment was to provide employers with the flexibility to manage their workforce while allowing workers to keep contributing to the battle against the virus, without sacrificing their leave entitlements when they needed the rest more than ever. Therefore, the regulations will override any provision in an employment contract stating that carry over is not permitted, but only in the limited circumstances stated above. They will not prevent workers carrying over more than four weeks, including the extra 1.6 week of statutory annual leave, if their employer agrees to this or if there are contractual provisions already permitting this. 

Employers can tell workers when to take their holiday if they give the right amount of notice. This is at least twice as many days as the amount of holiday that they want the worker to take. This notice requirement can be waived if the worker and the employer agree. This position does not change when a worker has been furloughed. They can still be asked to take holiday without breaking the furlough period, but this must be paid at their pre-furlough rate of pay (if their salary has been reduced).

Businesses can also ask workers to cancel a holiday, but they must give at least the same number of days’ notice to cancel as the length of the annual leave. The March 2020 amendment to the regulations also specifically says that an employer may only cancel the taking of leave, which has been carried over under the amendment, where it “has good reason to do so”. So employers should take care and, when they do need workers to change their holiday plans, they should clearly explain the reasons for this.

Best practice is still to avoid cancellation, as it is likely to cause significant resentment and store up more leave for future use. Over and above this, employers have an obligation to encourage staff to have time away from their desk (even if it is the kitchen table) and cancelling an employee's planned holiday should always be a last resort – with every effort made to allow workers to take annual leave as and when requested. 

Helena Rosenstein is a senior solicitor in the employment team at Blake Morgan