4. Holidays (Part 4)
How many holidays should workers get? (Article 10)
- The holiday year will cover the period 1 January to 31 December.
- The holiday entitlement set out in Part 4 of the Order complies with the provisions of the Working Time Regulations (WTR).
- Holiday entitlement depends on the number of days that an employee would be expected to work in the course of a regular working week (see table below). In addition, two special holidays are set. Details of these dates can be found below (article 11).
|No of days worked per week||No of days holiday per year|
- Where the number of days worked varies from week to week, the average number of days worked per week over a 12-week period should be calculated.
- When a worker begins working with an employer during the holiday year, their entitlement will be in relation to the part of the holiday year still remaining, plus any of the special holidays which fall within the same period.
- During the first year of employment, the number of days holiday that a worker has a right to take at any time is limited to the amount they have accrued at that time.
- Accrual is at the rate of one-twelfth of the annual entitlement at the beginning of each month.
- The WTR make it clear that a worker is entitled to a minimum of 5.6 weeks holiday (28 days for someone working 5 days a week) in a holiday year. There is no provision for payment in lieu of any part of these 5.6 weeks if they are untaken by the end of the holiday year. Payment in lieu will, however, still apply to holidays which are over and above the provisions set by the WTR.
- If a worker's employment is terminated, then they will be entitled to payment in lieu for all holidays to which they are due, calculated up until the date of the termination of employment.
What about special holidays? (Article 11)
- In 2020/2021, each worker will be entitled to two special holidays as follows:
- Christmas Day;
- New Year's Day.
- If either of these days falls on a day of the week on which the worker would not normally be required to work, then the next normal working day will be allowed as a holiday.
Is time allowed off for bereavements? (Article 12)
- In the event of the death of a worker's child, parent, spouse, or someone they live with as if they are married to them (see article 12(2) of the Order for a full definition), the worker is entitled to at least three days paid bereavement leave.
- The Parental Bereavement (Pay and Leave) Act 2018 received Royal Assent on 13 September 2018. It entitles employees who find themselves in the tragic situation of having lost a child under the age of 18 to have 2 weeks' bereavement leave and, for those with the necessary qualifying service, paid leave. Regulations are required to bring the schedule to the Act (which creates the statutory entitlements) into force and this is expected to happen in April 2020.
What payments are made for the holidays taken by a worker? (Article 13)
- A worker is to be paid for his/her leave according to sections 221-224 of the Employment Rights Act 1996, which determine the amount of a week's pay for the purposes of the Act.
A normal week's pay is calculated as follows:
- For a worker with regular working hours:
(i) If his/her normal working hours are the same every week and pay for work done in those hours does not vary, a week's pay is what he/she earns in a normal working week.
(ii) If pay varies with the amount of work done in normal working hours (i.e. the number of hours in a working week does not vary), a week's pay is the average hourly rate of pay in respect of the previous 52 weeks.
From 1 April 2020 holiday pay will be calculated using a 52 week average not a 12 week average. This has been introduced as a result of the Taylor Review of Modern Working Practices in 2018. The Employment Rights (Employment Particulars and Paid Leave) (Amendment) Regulations 2018 increase the reference period for determining an average week's pay from 12 weeks to 52 weeks. This is designed to ensure that workers who do not have a regular working pattern throughout the year are not disadvantaged by having to take their holiday at a quiet time of the year when their weekly pay might be lower.
- Overtime: employers' liability to include overtime in holiday pay will vary from case to case. Recent case law confirmed that 'regular' voluntary overtime should be included in the calculation of holiday pay to comply with the Working Time Directive which provides for 20 days annual leave. Recent UK tribunal and European court decisions have confirmed that payments intrinsically linked to the performance of tasks the worker is required to carry out under the contract of employment and payments linked to the worker's professional and personal status should be reflected in holiday pay. This includes commission and may include bonuses. Employers should take their own legal advice if they are unsure of their obligations.
What happens if a worker has to turn out on a holiday? (Articles 10 and 14)
- If a worker has to work for any part of a day on which it had been agreed that they would be on holiday (excluding special holidays) the following rules will apply:
- the day will not be regarded as a holiday taken i.e. the worker's holiday entitlement will not be reduced in any way;
- each hour actually worked will be paid at not less than the minimum hourly rate (excluding the additional sum) to which the worker is entitled multiplied by 1.5. A minimum of four hours must be paid even if the time worked is less than four hours. When more than four hours are worked, payment must be made for the actual number of hours worked.
- Different arrangements apply when a worker has to turn out on any of the two special holidays. If a worker is required to work on 25 December or 1 January, the following rules will apply:
- for each hour worked, the worker must be paid not less than three times the minimum hourly rate (including the additional sum if appropriate). In these circumstances there is no requirement to pay for a minimum of four hours - payment need only be made for the actual hours worked;
- in addition, if 25 December or 1 January fall on a day which the worker would normally work, then this day will count as holiday taken - the worker is not entitled to a day in lieu but is entitled to a day's holiday pay on top of any payment for the hours worked that day.
(Note: These rules will apply when a worker who would not normally have worked on one of the two special holidays is required to work on the holiday in lieu to which they are entitled, i.e. their next normal working day.)
What happens when the full holiday entitlement is not taken? (Article 15)
- Where a worker has not taken all of the days holiday to which they are entitled by the end of the holiday year, that worker will be due payment in lieu for only the days which are over and above the entitlement set by the WTR.
- Where a worker has not taken all of the days holiday to which they are entitled on the termination of their employment, that worker will be due payment in lieu for any days not taken.
- Payments in respect of holidays not taken (subject to the above) should be made no later than the first regular pay day after 31 December or within seven days of the end of employment.
Who decides when holidays can be taken? (Article 10(8))
- Normally a worker and employer will be able to agree suitable holiday dates between them.
- Where no such agreement can be reached, the employer may give the worker 21 days notice of the date(s) when the holiday can be taken. The employer will allow the holiday to be taken before the end of the holiday year, or before the worker leaves their employment, whichever date is the earliest.
- When considering a holiday request, the employer must act reasonably, not in an unreasonable or capricious way.
- In circumstances where an employer refuses a workers request to take a holiday on the date(s) requested, the employer should provide the worker with a justifiable reason for refusal in writing.