10 tips for managing employee statutory holiday rights

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employee holiday
Here we are again at a time when many employees are taking time to jet off to destinations far and wide. It’s important that employers understand that employees have certain statutory rights when it comes to taking annual holiday.

Here are out top ten tips to enable you to ensure that you understand your rights and responsibilities as an employer.
  1. Minimum Entitlement: The Working Time Regulations 1998 (WTR) provide that a full-time employee is entitled to 5.6 weeks (28 days) annual holiday in each leave year. This is a minimum of 20 days’ annual leave plus the UK right to an additional 8 days which represents the England and Wales bank holidays each year. However, it is not essential that the time be taken off on the days the bank holidays fall. A part-time worker will be entitled to a pro-rata proportion of the 28 days. So, for example, an employee working a four-day week will be entitled to 4/5 of 28 days, 22.4 days.
  2. Accrual: Holiday starts to accrue from an employee’s first day of employment.
  3. Carrying Holiday Over: The WTR states that the minimum 20 days’ entitlement must be taken during the leave year to which it relates. If the leave is not taken, it is lost and cannot be carried forward to a subsequent year. The additional 8 days may be carried forward where there is a specific contractual agreement between employee and employer. If there is no contractual agreement, this will be treated in the same way as the 20 days above. Some employers offer more than the statutory minimum holiday entitlement in which case it is up to them to decide whether or not allow employees to carry forward the additional days into the next holiday year.
  4. Holiday Entitlement on Termination: Holiday continues to accrue up to the termination date. If an employee has not used up all of their holiday entitlement by the termination date, they will be entitled to receive a payment in lieu. If an employer does not require an employee to work out their notice and pays them in lieu, holiday will accrue up to the last day of work – not to the end of the period when the notice would have terminated had the employee worked out their notice.
  5. Holiday Accrual During Sickness Absence: An employee who is off sick will continue to accrue holiday during the period they are absent and may in this instance, carry forward their accrued holiday entitlement into the next year or be paid in lieu.
  6. Holiday Accrual During Maternity, Paternity and Adoption Leave: Holiday continues to accrue throughout any period of maternity, paternity and adoption leave in exactly the same way as it accrues with long-term sickness absence.
  7. Booking Holidays: Most companies have predefined rules about the booking of holidays and it is perfectly acceptable to limit the number of employees who can take time off at any one time to ensure that adequate cover for the business. Employers should make sure that the rules and clear and that all employees are fully aware of them.
  8. Holiday Refused and then the Employee is off Sick: If a request for holiday has been refused and then the employee takes the time off as sickness absence, then the Employer should carry out a thorough investigation and instigate disciplinary action if appropriate.
  9. Employee Sick During Holiday: If an employee genuinely falls ill during their holiday, they should be permitted to take their annual holiday at another time. In that instance the Company would pay whatever they normally pay when an employee takes time off for sickness.
  10. Non-return from Holiday: There are occasions when employees simply don’t return from their holiday. The employer should try to make contact with the employee by telephone, email and letter. If after at least three attempts to make contact have failed and the employee has not returned, then invite him to a disciplinary hearing for unauthorised absence having failed to return from holiday. It’s likely that he may not attend that meeting. If he doesn’t, then the employer should invite him to a further disciplinary hearing indicating that if he fails to attend on this occasion without good reason, then the hearing will take place in his absence.


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