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Annual Leave Update

Information for Employers

Annual Leave Update – Covid- 19 

On Friday 27th March the Government announced that workers who have not taken all of their statutory annual leave entitlement due to COVID-19 will  be able to carry it over into the next 2 leave years.

The statutory entitlement for almost all full time employees is 28 days holiday including bank holidays each year (pro-rata for part time employees). However, in most businesses this entitlement cannot be carried between leave years, resulting in employees losing their holiday if they do not take it.

There is also an obligation on employers to ensure that employees take their statutory entitlement in any one year – failure to do so could result in a financial penalty.

These new regulations will allow up to 4 weeks of unused leave to be carried into the next 2 leave years, easing the requirements on business to ensure that employees take statutory amount of annual leave in any one year.

This will mean employees can continue working in the national effort against the coronavirus without losing out on annual leave entitlement.

The changes will  ensure all employers affected by COVID-19 have the flexibility to allow workers to carry over leave at a time when granting annual leave could leave them short-staffed in some of Britain’s key industries, such as food and healthcare.

The changes will amend the Working Time Regulations, which apply to almost all workers, including agency workers, those who work irregular hours, and workers on zero-hours contracts.

The change is aimed at allowing businesses under particular pressure from the impacts of COVID-19 the flexibility to better manage their workforce, while protecting workers’ right to paid holiday.

If you have any questions regarding these new regulations our advisors will be happy to help, please contact [email protected]

Further information from GOV.uk:

1. The Working Time Regulations 1998 convey a range of health and safety protections on workers, including daily and weekly rest breaks and paid statutory annual leave. Annual leave is granted by regulations 13 and 13A of the Working Time Regulations 1998, giving 4 weeks and 1.6 weeks of annual leave respectively.

2. The 4 weeks of annual leave granted by regulation 13 cannot generally be carried between leave years, with exceptions when a worker cannot take annual leave due to sickness or maternity leave. The 1.6 weeks of annual leave granted by regulation 13A can be carried forward one leave year (but no further) through an agreement between workers and their employers.

3. There is an obligation on an employer to ensure that their workers have an adequate opportunity to take their holiday. This holiday cannot be replaced with a payment in lieu unless the worker is leaving employment.

4. The Working Time (Coronavirus) (Amendment) Regulations 2020 amends the Working Time Regulations 1998 to create a further exemption relating specifically to COVID-19. Where it is not reasonably practicable for a worker to take some, or all, of the holiday to which they are entitled due to the coronavirus, they have a right to carry the 4 weeks under regulation 13 into the next 2 leave years. This will not apply to the 1.6 weeks under regulation 13A leave, but this can be carried forward one year by agreement between workers and employers.

5. For the purposes of annual leave, a year is the leave year as agreed in writing between the worker and their employer, usually stipulated in a worker’s contract. Although for some workers this will align with the calendar year (1 January to 31 December), it can be any year long period that is agreed upon.

6. All employers are subject to the Working Time Regulations 1998, and thus will be subject to the changes in the Working Time (Coronavirus) (Amendment) Regulations 2020.

7. All workers are subject to the Working Time Regulations 1998 unless they are subject to a different set of regulations. The Working Time Regulations 1998 do not apply to:

8. Furthermore, the regulations giving a right to paid annual leave do not apply to:

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