What Happens When Staff Can’t Take Their Holiday Entitlement?

What Happens When Staff Can’t Take Their Holiday Entitlement?

A survey  revealed that two-thirds of employees plan to carry over some of their annual leave into the new year, taking over 5.1 days on average.

The survey by price comparison site Finder.com holds implications for employers including domestic and household staff.

So what is the annual holiday entitlement anyway?

Almost all employees, including zero-hour contracted workers and those on irregular hours contracts, are legally entitled to 5.6 weeks’ paid holiday per year. The exception is those who are genuinely self-employed.

Furloughed Employees and Holidays

Workers who are on furlough are unlikely to need to carry forward statutory annual leave, as they will be able to take it during the furlough period (in most cases at least).

However,  they must be paid the correct holiday pay which is likely to be higher than the rate of pay that will be covered by government grants, with the employer making up the difference.

Employees in this situation  must still be given the opportunity to take their annual leave, at the correct holiday pay, before the carried annual leave is lost at the end of the next 2 leave years.2

Carrying leave forwards: how new legislation has changed the rules

The government has passed new emergency legislation to ensure employers  have the flexibility they need to respond to the corona virus pandemic and to protect staff  from losing their statutory holiday entitlement.

These regulations enable employees  to carry holiday forward where the impact of corona virus means that it has not been reasonably practicable to take it in the leave year to which it relates.

Where it has not been reasonably practicable for staff to take some or all of the 4 weeks’ holiday due to the effects of corona virus, the untaken amount may be carried forward into the following 2 leave years. When calculating how much holiday an employee can carry forwards, you must give staff  the opportunity to take any leave that they cannot carry forward before the end of the leave year.

Payment in lieu for carried leave

Carried leave is still subject to the usual rules around payment in lieu. An employer must facilitate staff to take their annual leave and not replace it with a financial payment (known as payment in lieu).

However, if  your employee leaves you must pay the worker for any untaken leave.

This will include the carried leave under the coronavirus exemption, along with any leave that the employee has accrued in the relevant leave year.

We are grateful to the government  for supplying information and even fuller details are available on their website: www.gov.uk and follow the links to Work and financial support during coronavirus.



The Graham Agency – keeping you informed