There is often confusion about rights that employers and employees have when booking and taking annual leave.
Best practice is that both should communicate with one another as soon as possible when discussing the taking of holiday. Both sides should also be flexible and understanding of business needs and the employee's reasoning behind taking leave at that time. They may, for instance need leave at a certain time because of a significant life event.
Flexibility and communication helps to maintain a positive working relationship and ensures that the time taken off benefits both parties.
As an employer, you have the right to set policies around when and how your staff take their holiday leave. It's very important however to put clear guidelines in place, so that staff expectations are met.
Clear holiday guidelines enable you to keep positive relationships with your employees, while keeping operations at your company running smoothly.
Employees should submit their requests for holiday dates well in advance, ideally giving the employer at least twice the amount of time as the length of leave they wish to take. For example, if an employee wants 10 days off, they should request it at least 20 days in advance, unless specified otherwise in their employment contract. Plenty of notice should make it easier for an employer to grant the leave, as plans can be made to cover the employee's absence.
An employer can define a fixed start and end date for their company's leave year. This period, known as the leave or holiday year, should be clearly explained to employees and documented in their contracts. For instance, companies can align their leave year with the financial year, such as from 1 April to 31 March, or from the 1 January to 31 December. If a leave year isn't set, it defaults to the date the employee started with the company. Employees are entitled to 5.6 weeks of statutory holiday, which they should take within the leave year.
An employer has the right to refuse or cancel an employee's holiday request, provided they give notice at least equal to the length of the requested leave. For instance, if an employee requested seven days of holiday, and an employer realises they'll be needed at work, they must inform them of the cancellation at least seven days in advance.
While you must have a valid business reason for these decisions, consider the potential impact on employee relations, especially if they've already made personal arrangements or the leave is linked to an important life event such as a wedding, moving house, religious event, or a funeral.
Employers can force employees to take holiday leave at times that suit the business, such as during a shutdown over Christmas from 25 December – 2 January. If so, you must give employees at least twice as many days' notice as the leave required. For example, if employees are to take 5 days off, notify them at least 10 days in advance. Additionally, unpaid leave may be mandated if agreed upon in the contract.
To effectively manage holiday leave, communicate all rules and restrictions clearly to staff. Ensure fairness and consistency in your approach, as this helps avoid work-related conflicts, while mitigating the risk of legal claims. Remember, you have a legal obligation to ensure employees can take their entitled holiday, and you should also promote staff taking holiday to improve their well-being and work-life balance.
As an employer, you have the authority to determine when employees take their holiday leave. However, it's important to follow the legal requirement of providing two days' notice for every day of leave you need them to take.
When making the decision to enforce leave, make sure that any requests are reasonable and non-discriminatory. Dictating specific leave dates is generally an uncommon practice, with the exception of Christmas company closures. All employers should approach the matter fairly, with clear guidelines that should be outlined in the employee's contract or staff handbook. For instance, you may restrict leave during peak business periods, such as the lead-up to Christmas, or decline requests for leave in which two or more staff members are absent at the same time.
The law requires that these rules are clearly defined, reasonably justified and consistently enforced.
Employees have a legal right to holiday leave, which is considered part of protecting their health, safety and welfare. It's unlawful for employers to make it difficult for employees to take their entitled leave. Instead, they should encourage staff to take it as and when they need to.
During an employee's notice period, they may be entitled to take any remaining statutory annual leave, and an employer can insist that they take this remaining leave as holiday. Employers can use a holiday entitlement calculator to determine the exact amount of leave based on how much of the leave year has passed, or the leave accrued by the employee.
If an employee has taken more leave than they're entitled to, employers cannot deduct money from their final pay unless this has been agreed upon beforehand in writing. These rules should be clearly outlined in the employee's contract.
When they officially leave their job, employees can receive payment in place of taking statutory leave, known as 'payment in lieu'. Employers must pay for any untaken statutory leave, regardless of the circumstances, including dismissal for gross misconduct. For any additional leave beyond the statutory 5.6 weeks, employers can set separate terms and conditions, which should be specified in relevant employment agreements.
It's possible for employees to experience sickness when they are on holiday, or for them to take holiday while they are on sick leave. In these situations, it's essential for employers and employees to communicate and agree on whether the time off will be recorded as sickness or holiday. This will confirm whether the employee will receive sick pay or holiday pay for the time off. If your company has a policy on this matter, make sure it's applied fairly.
Document any discussions and agreements on such matters in writing, such as in a letter or email, to avoid misunderstandings.
Employees have the right to use their paid holiday (annual leave), even when they are off sick. This might occur if the following situations apply:
It's up to employees to request to use holiday while they're on sick leave. Employers cannot force employees to take holiday during this time. If an employee requests holiday while on sick leave and the employer approves it, the sick leave can be temporarily paused during the holiday period. The employee should then receive holiday pay for the duration of their holiday. Once the holiday ends, if the employee is still unfit to return to work, their sick leave can resume.
If an employee has issues regarding holiday, encourage them to address the matter informally first. As an employer, you should take their concerns seriously and work with them to resolve any problems. Explain the reasoning behind any decisions taken. Ensure you offer different solutions, such as partial leave or remote work.
If informal discussions can't resolve the issue, the employee can file a formal grievance. Involving a neutral third party, such as a mediator, may help facilitate a resolution. Employers should ensure compliance with legal requirements related to holiday entitlements, and always consider how their decisions on holidays may affect employee relations. By handling disputes fairly and consistently, employers can maintain trust and morale.
If you're an employer needing expert help on sick leave, holiday entitlement and annual leave policies, our consultants at Neathouse Partners can help. Contact us on 0333 041 1094, or book in a call with one of our team.