The effect of COVID-19 on holiday entitlement and pay 14 May 2020
The department for Business, Energy and Industrial Strategy (BEIS) has published guidance relating to how holiday entitlement and pay will be treated during the coronavirus crisis, and how it differs from the standard holiday entitlement and pay guidance.
The guidance is aimed at employers with the intention of helping them to understand their duties in terms of workers who continue to work and also those who have been placed on furlough.
Employers and workers should address individual contracts and if necessary, seek the relevant independent legal advice.
Holiday entitlement
The majority of workers are entitled to 5.6 weeks’ worth of paid holiday on an annual basis. There is an exception to this in those who are self-employed.
The statutory 5.6 weeks is split into four weeks derived from EU law, and an additional 1.6 weeks in UK law. The guidance relates to the UK’s legal minimum entitlement of 5.6 weeks. This is the minimum requirement, but many employers may offer additional holiday that extends past that point. This will be detailed within an employee’s contract of employment. The entitlement remains unchanged regardless of whether an individual is on sick leave, parental leave or any other form of statutory leave. A worker can request holiday at the same time as they are on sick leave but cannot be forced to take holiday while off sick.
Workers who have been placed on furlough continue to accrue statutory holiday entitlements throughout the period in which they are placed on furlough, and also any additional holiday entitlement laid out in their contract of employment.
Taking holiday
Employers have the ability to require workers to take holiday, and to cancel a worker’s holiday, where sufficient notice is given to the worker.
The mandatory notice periods are:
• Double the length of the holiday if the employer wishes the worker to take holiday at a specific time • The length of the planned holiday where the employer wishes to cancel a worker’s holiday or requires the worker not to take holiday on particular dates Employers can request that workers take or cancel holiday with less notice, but the worker must agree to this. The notice periods are in advance of the first day of the holiday, and the notice must be given prior to the notice period commencing. To put this into practice, if an employer wanted to stop a worker from taking a week’s holiday, they would have to give notice earlier than one week before the first day of that holiday. When calculating the notice period, any uninterrupted period of holiday counts as a single period. The rules on notice periods can be amended by written agreement between the employer and the worker.
Workers on furlough are entitled to take holiday, and for it to have no effect on their furlough. The mandatory notice periods still apply.
If employers would like workers to take annual leave during their period of furlough, they should discuss this with them before requiring them to do so. Employers should also consider if there are any restrictions employees are under, for example, if they must socially distance or self-isolate, as this could potentially stop the worker from resting and relaxing, which are the purposes of taking holiday.
Bank holidays
The Chartered Institute of Payroll Professionals
Payroll: need to know
cipp.org.uk
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