Many businesses are facing the start of a new annual leave year in January. Whether your annual leave year begins in the new year or not, this article outlines our top tips for planning ahead, based on the most commonly asked questions raised by our clients.
The annual leave entitlement in the UK is 5.6 weeks or 28 days, each year for someone working 5 days a week. This is the minimum annual leave entitlement that employers must provide. The entitlement can include bank/public holidays and applies to all types of employees and workers, except those who are genuinely self-employed.
False! Annual leave is paid at the time it is taken. The only exception to this is when the period of employment ends (resignation or dismissal) and the employee has not taken all of the annual leave they have accrued at the point of leaving. Under these circumstances, the employee is entitled to be paid for the annual leave that is owed to them with their final salary.
So, unless your employee is planning on leaving or their employment is being terminated, they have no right to insist that they are paid for any owed annual leave.
When it comes to allowing time off work to observe any religious festival, there is no automatic right to take time off work for religious observance.
However, if you receive an annual leave request for religious observance that cannot be accommodated, it is important to ensure that you have a good business reason for refusing the request and that you are being consistent in your approach to authorising annual leave (more on this later).
It’s also important to note that many bank holidays coincide with Christian festivals, e.g., Easter and Christmas. If your business closes at these times of year, bear in mind that employees of other faiths, who will have to book and authorise their time off, may feel disadvantaged. To avoid placing yourself at risk of a discrimination claim, please ensure you seek advice from our experts before turning down a request for annual leave for religious observance.
Did you know? Employees who are not religious, such as atheists, are also protected from less favourable treatment under the Equality Act on the grounds of their non-religious beliefs.
Employers have a legal duty to diligently remind staff that unless they book their leave within the annual leave year, their entitlement to annual leave and pay will be lost. There are exceptions to this, such as for those on long-term sick leave or maternity/shared parental/adoption leave, where annual leave can carry over.
For more information, read the right to carry over annual leave.
Yes, the employer can place an employee on annual leave by giving twice the amount of notice as the leave you want them to take.
For example, if you want them to take 5 days off, 10 days’ notice must be given.
This approach should only be used as a last resort, and where attempts to informally resolve the matter have failed.
A holiday buy-back scheme is where an employee can exchange a portion of their annual leave entitlement for payment instead of taking time off work.
This should only apply to annual leave entitlements that are above the minimum statutory entitlement. For example, if you provide a holiday entitlement of 30 days, you could allow staff to buy back the additional 2 days that are above the statutory minimum.
Holiday buy back schemes should be voluntary, and the rules must be clear, with any payments in accordance with the scheme being clearly itemised on the employees pay statement.
A holiday purchase scheme is where employees can purchase additional days of annual leave from their employer.
Employers cannot insist that employees purchase statutory annual leave, and the rules for the purchase of additional holiday should be made clear. It is usual for the employer to set a minimum number of days employees can request (you do not want to end up with excessive holiday entitlements across your business that you can’t accommodate) and also to set a deadline for making a request to purchase holiday.
It is important that the employer is clear on how payment for any leave that is purchased will be made (usually deducted from wages in equal instalments across the year) and that any deductions from wages under the scheme are expressly agreed to by the employee, as well as being clearly itemised on the employee’s pay statement.
DO be fair and consistent. A ‘first come, first served’ system is best to avoid allegations of favouritism.
DO have a cap on the number of staff allowed off at any one time and stipulate a minimum amount of notice required. This will help you manage annual leave requests and avoid becoming short-staffed.
DO ensure that if you expect staff to reserve annual leave for business closures (e.g., a Christmas shutdown), all staff are aware of this and that the requirement is set out in the employment contract.
DO ensure that all staff are aware of the rules regarding booking and authorising annual leave and that managers apply them fairly and reasonably.
DO issue regular reminders throughout the year to remind staff that they need to book their leave, or the leave will be lost, as will their right to pay in lieu of untaken holiday. If sending reminders by email, keep a copy of the email and add ‘read receipts.’ If issuing reminders in staff meetings, take meeting minutes showing who was present, and ensure those who are not in attendance are given copies of the minutes.
DO turn own a leave request in writing and forewarn the employee that if they do not turn up for work, their absence will be unauthorised and unpaid. You can also forewarn the employee that if they subsequently call in sick, this may not be deemed an acceptable reason for absence, and they could face disciplinary action. Before withholding pay or taking formal disciplinary action, clients must seek Avensure’s advice.
DON’T turn down annual leave requests on principle. Whilst it is good practice to have rules in place, there may be occasions where the correct notice could not be given or you may need to allow someone to take the day off even though you are already at maximum capacity e.g., a funeral.
DON’T impose unreasonable numbers of staff allowed off at any one time. For example, it is not reasonable to insist someone give one month’s notice to book one day off. Likewise, if you are too restrictive on the numbers of staff you allow off, you will end up with a situation where your staff cannot take all of their leave in the annual leave year.
DON’T discriminate. Please ensure that members of staff requesting annual leave for religious reasons are not treated less favourably. And finally….Read this if you’re concerned about how to handle employee absence during the festive season.
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