Holiday time – The key legal issues

May 31, 2016

As the weather starts to (slowly) improve, many of us are starting to think about the summer holidays. In the UK, all workers are entitled to at least 5.6 weeks’ paid holiday, which is 28 days’ holiday for a full-time worker. It can include bank and public holidays. It is made up of 4 weeks of holiday that the European Union says that all workers must have and another 1.6 weeks that workers are entitled to under UK law.

The term ‘workers’ includes employees but it also includes many others who work for an employer (except those who are genuinely self-employed).

Unless a worker’s contract or a holiday policy says something else, the worker asks for holiday by giving their employer a notice requesting holiday that is at least twice the holiday that the worker wants to take. The employer can refuse the worker’s holiday request by giving a notice. The employer’s notice should be given at least as many days before the holiday as the worker has asked for.

An employer can also tell a worker when to take holiday, they have to give notice that it is at least twice the period of leave that the employer wants the worker to take. The worker can’t refuse this notice.

Workers are entitled to be paid for their holiday. The 4 weeks of EU holiday must be paid at the worker’s normal rate of pay, and include all the essential elements of a worker’s pay that are directly linked to their role. It should include:

  • salary;
  • guaranteed overtime (overtime that an employer has to offer workers and workers have to work);
  • non-guaranteed overtime (overtime that an employer doesn’t have to offer workers, but if it does, workers have to work it;
  • commission; and
  • bonuses (unless the bonus is not related to the worker’s performance).

But it doesn’t include voluntary overtime (overtime that workers don’t have to work if it’s offered) – unless it has become a regular arrangement.

These extra payments to be included when calculating holiday pay only apply to the 4 weeks’ EU holiday, not the extra 1.6 weeks that UK workers get or any extra holiday offered by employers. These can be paid at an employee’s basic salary (without the extra payments).

Workers can’t be paid instead of taking holiday except when a worker’s employment ends and they have not taken all the holiday that they were entitled to at the date when their employment ends. Employers can also get workers to repay them where a worker’s taken more holiday than they are entitled to at the end of their employment.

It’s always a good idea for employers to set out their holiday procedure in a worker’s contract or a policy (and some information about holiday entitlement has to be included in an employee’s contract). A policy makes clear the rights of both the employer and the worker. It can also:

  • increase the notice periods that a worker has to give before taking holiday, giving the employer more time to prepare for the worker’s absence;
  • require the worker to get their manager to agree (in writing) to any holiday;
  • limit the amount of holiday that the worker can take at one time;
  • make clear what holiday (if any) can be carried over to the next holiday year; and
  • make workers take their holiday during any notice period.

Louise Paull – LawBite Employment LawBrief. For further legal advice you can contact Louise via our online legal advice portal.

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