Annual leave guidance for employers

21 Aug 2018 By Simon Allison

UK workers who fail to use their annual leave entitlement are at risk of burnout and employers need to take steps to avoid this, says Simon Allison

Considering the recent heatwave, it may come as a surprise to learn UK workers are at greater risk of burning out than getting burnt. However, recent research from the Trades Union Congress (TUC) shows exactly that, revealing that one worker in 12 does not take annual leave when they should.

In the UK, there are 1.2m workers who receive no annual leave at all and 2.2m workers who get less than the statutory minimum holiday entitlement. The Department for Business, Energy and Industrial Strategy (BEIS) has urged employers to ensure workers get the holiday and leave they are entitled to. It plans to introduce new rights for millions of workers which will include provision for holiday to be enforced for vulnerable employees. 

When it comes to annual leave, the legal position is clear – 28 days per year for full-time workers, or on a pro-rata basis for part-time employees. This can include public holidays provided this is paid leave. Given the potential plans by BEIS to force workers to take holidays, how can employers ensure that their workers are taking their annual leave entitlement?

Annual leave allowance should be unambiguous and in writing, clearly specifying what is entitled and if it includes public holidays. A failure to make this clear could result in claims for a breach of contract and/or holiday pay.

Employers should also set out in writing the holiday leave year period (for example, 1 January to 31 December). If a written agreement is not in place, the leave year will run from 1 October for anyone who started work on or before 1 October 1998. If it’s later, the leave year should commence on the date the worker joined the business. 

A failure to make the leave period clear can create confusion for businesses when staff have differing leave year dates. It is good practice to advise employees of their annual leave entitlement biannually, so employers cannot be accused of failing to inform its workers of their entitlement. A reminder close to the end of the leave year urging staff to use their holidays is also wise. 

Businesses should review procedures and if one is not in place the default position is to force a worker to take annual leave on certain days with appropriate notice. Employers must clearly specify when leave is to be taken and give notice at least two times the number of days’ holiday. So if someone is told to take a week off work, they require two weeks’ advance notice.

Any holiday pay that is accrued should be paid on termination of employment. If someone can’t take leave due to long term sickness or maternity leave, they may be entitled to carry over. This carry-over has a lifespan and current legislation limits this to a period of 15-18 months after the end of the holiday year, after which it will be lost. Employers who wish to limit carry-over in this way should include specific wording to that effect.

So to ensure workers use their annual leave entitlement to avoid the risk of burnout, employers should encourage employees to see some sun, sand, vitamin ‘sea’ or even enjoy a staycation.

Simon Allison is a partner in employment law at Blackadders

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