A guide to annual leave entitlements

August 26, 2021

A guide to annual leave entitlements

With the ever-changing COVID-19 travel restrictions, vaccine passports, andquarantine rules, booking a holiday has never been more confusing. But what about

holiday pay? Is it a legal responsibility to pay your staff for holidays?


The short answer is 'yes - but the ins and outs of annual leave entitlements are a

little more complex. By law, an employer must provide paid leave. But how much

should you offer? Can you refuse to leave? And what about part-time or zero-hour

workers? In this guide, we will outline the holiday pay facts that every employer

needs to consider.


Who is entitled to holiday pay

All contracted workers, without exception, are entitled to 5.6 weeks of paid holiday

per year. It sounds like a lot, so how does that number work in practice? To work out

how much paid holiday an employee is entitled to, take the number of days they

work per week, and multiply this by 5.6.

For example:

-A full-time employee working five days a week must receive at least 28 days' paid

holiday a year (5 x 5.6 = 28).

- A part-time employee working two days a week must receive 11.2 days' holiday

(2 x 5.6 = 11.2).


How much should they get?

As an employer, it's up to you whether or not to include the UK's eight bank holidays

as part of annual leave entitlement. It's also worth noting that the legal minimum paid

holiday is 28 days, so someone working six days a week is still not entitled to more

than 28 days' annual leave.


Agency workers and those with irregular hours, such as individuals on a zero-hours

contract, must also receive holiday pay. It's usually easier to calculate this based on

the number of hours worked, as they may not have a set number of working days per

week. The government has developed a holiday entitlement calculator to make

this process easier.


Can staff carry over untaken leave into the following year?

Some holiday entitlement can be carried over into the following year, but this is only

a small amount - a maximum of 8 days for a worker with 28 days' leave. This means

a worker will lose most of their holiday if they do not take it, so it is the employer's

responsibility to encourage staff to take all their allowed leave.


The rules were recently relaxed for key workers whose leave has been affected by

COVID-19. These workers can now carry over up to 4 weeks' unused leave into the

next 2 years.

Booking time off - what is the government guidance?


An employee is usually expected to give notice if they want to book time off. It is

usual for the notice period to be at least twice as long, plus one day, as the amount of

leave a worker plans to take. This would mean, for example, 15 days' notice for a

week's leave.


As an employer, you do not have to accept a leave request. However, when refusing

or cancelling leave you should give as much notice as the amount of leave

requested, plus one day - this would be 8 days' notice for one week's requested

leave.


Employers are also within their rights to tell workers when they can and cannot take

leave. For instance, asking employees to take leave over Christmas, or restricting

leave during busy periods. When asking staff to book leave, an employer should give

a notice period of twice the amount of leave they are asking employees to take.


While these notice periods are common practice, if a contract specifies a different

system, the contract will apply. Nonetheless, for planning purposes, as well as staff

morale, it is beneficial to have a fair and effective system in place for booking leave.


How we can help

It is a legal requirement to pay your staff for holidays, but the rules can seem

complex. If you need help to navigate the world of annual leave entitlement, Cangafs

friendly and experienced team of bookkeepers are here to help. Give us a call on

01204860128.

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