As a manager, or employee, of a business, the importance of regular breaks from work is essential.
However, a recent study has shown that nearly half of staff (43%) did not even take one full week’s holiday last year. Most staff were found to have as many as 5 days’ leave remaining (unused).
We have seen an increase in queries relating to annual leave, and have covered the most commonly asked questions in this Q&A.
Why is it important to take holiday?
Apart from the obvious benefit of time to relax and refresh, staff who do not take adequate breaks from work at risk of stress-related absenteeism, burnout, poor health, lower productivity, and physical symptoms.
How can you encourage staff to take holiday?
Having a culture where holiday is encouraged, and prioritised is important. In companies where employees are worried about taking leave due to increased workload on their return, falling behind on duties, or missing important updates can make staff reluctant to book leave. In addition, some staff may not want to take leave due to other issues, for example problems at home, domestic violence, or mental ill health.
Identifying those who do not regularly book leave, or who are concerned about doing so, is vitally important. Have a conversation with them to understand the reasons why, and identify solutions to any concerns can ensure that these are overcome.
How much leave do staff get?
The legal minimum in the UK is 5.6 weeks per year. This is made up of 28 days (20 days plus 8 bank holidays). This amount is pro-rata’d for part timers, but should still equate to 5.6 weeks at their part time hours.
Should annual leave be worded as 28 days (including bank holidays) or 20 days plus bank holidays in contracts?
Legally, it doesn’t make any difference how it is worded, as long as staff receive the full entitlement. However, in years where there are extra bank holidays awarded, i.e. the Coronation, if your contract is 20 days plus bank holidays, you would need to give the extra days in addition. If your contract is inclusive, then there is no need to increase entitlement for any additional days that might be awarded.
Is it better to run holiday years as calendar years, financial years, or other?
Again, legally it doesn’t make any difference. However, there are many benefits to running leave as a calendar year (January – December), namely that you know all bank holidays will fall within that period. This can make it easier for managing. Where you run leave as financial years, this can sometimes cause issues where Easter falls either early, or late, as can result in some years having too many, or not enough, bank holidays to meet the statutory requirements.
Can you make staff take holiday, or restrict when they take it?
Yes, you can. You can give staff notice to use their annual leave, however this must be twice as much notice, as leave. For example, if somebody is required to book 1 week off, they would need to be given 2 weeks’ notice of this.
Your business can also specify when leave can, or cannot, be taken. I.e. many companies have a festive shut down, where staff use annual leave. Or you might restrict leave in your busier months (July and August for example). As long as you allow sufficient time for staff to take their leave within the year, you can impose company rules. However, you must make sure these are fairly applied across all staff, and are not discriminatory. Other types of rules you may have might be the number of staff who can be off at any one time.
Do staff receive additional holiday when they work overtime?
The actual amount of holiday entitlement staff get doesn’t change. It is always 5.6 weeks/28 days (or pro-rata’d or enhanced depending on hours and policy).
However, staff who work “regular” overtime, including commission, bonuses etc, can expect to receive that as part of their pay when they take holiday.
So, when a member of staff takes annual leave, you should review their pay over the past 52 weeks (you can go back up to 104 weeks to get the most recent 52 weeks of pay), and the average pay from that period is what they should receive when they are on annual leave.
When is the 12.07% calculation used?
The 12.07% calculation is based on the statutory 28 days holiday, and is generally used for staff who work irregular hours or zero hours contracts. For these staff, it is often easier to pay their annual leave, as opposed to them taking paid time off. In this case, the amount is added to their salary, but must be shown as a separate line on the payslip.
If you need any support with any aspect of annual leave, including policies, pro-rata’ing entitlement, or allocation, please contact us on team@hrprime.co.uk.