Holiday entitlement: the basics

Regardless of where you work, all staff are entitled to the occasional break from Excel spreadsheets and £3 meal deals. Just how many days of holiday and the amount of pay might differ depending on the individual though, so it can be worthwhile to occasionally brush up on your legal knowledge of paid leave. 

So in case you're new to HR or you just need a refresh, here are some of the basic laws surrounding holiday entitlement that all HR professionals should know about.

How much holiday are staff entitled to?

Everyone in the UK (mostly) is entitled to 5.6 working weeks of paid annual leave. This means that permanent staff who work a 5 day week, are afforded 28 days' holiday per year. This is known as statutory leave entitlement and is limited to a maximum of 28 days. If an employee joins part way through the year, you should divide their annual number days entitlement by 12, and then multiply by how many months are left in the leave year. 

You can decide to allow staff more time off than the legal requirement and this is known as 'extra leave.' Statutory rules don't need to be applied to this extra holiday.

Are part-time workers entitled to the same holiday?

If you employ part-time or flexible working staff, they will also be entitled to the same 5.6 weeks of paid leave as your full-time workforce. This won't match up to the same number of days however. For instance, somebody who only works a 2 day week should only receive 11.2 days of annual leave (2 x 5.6 = 11.2). You can't round down the number of full days, but you can round up. 

Our conversion table below shows how many days of holiday each employee is entitled too.

Are bank holidays included in statutory leave?

There is no obligation for employers to provide paid leave for bank holidays and these are usually included as part of the statutory entitlement. Although there is no legal right for paid leave, some employers may decide to allow it. 

Can you stop staff from taking holiday?

Although you can't prevent staff from using their holiday entitlement, you can refuse to accept requests for leave. If you're unable to allow a member of staff time off, notice must be given the same number of days in advance as the number of days requested. So if you can't grant 2 days' holiday for whatever reason, this must be made clear 2 days prior to the start date. 

How much is holiday pay?

Staff are entitled to a week's worth of pay for every week of leave they take. So if staff normally get paid £300 a week, they should receive this same level of pay for their time off. For part-time workers, this is worked out by deducing the average number of weekly hours that they have been paid for in the previous 12 weeks. 

Some companies may decide to implement 'rolled-up' holiday pay, where you increase an employee's hourly rate instead of paying them during their annual leave. This is generally discouraged by HR professionals, however those that use this method need to clearly state in an employee's pay slip what their actual hourly rate is and how much they're receiving as 'rolled up' pay. For example, you may pay staff an hourly rate of  £7.50, and pay them a further 90p as holiday pay. 

What if staff can't take holiday?

It is a legal requirement for staff to take a minimum of 4 weeks' statutory leave in any one year. Days left remaining may be added onto the following year's total, however this request doesn't have to be accepted. Should an employee not be able to take their statutory leave (perhaps due to sickness or maternity leave), you must allow them to carry over a maximum of 20 days' holiday, if they so desire. 

Holiday entitlement is a key HR issue and should be outlined clearly in an employee's contract before they join the company. Leaving as few grey areas as possible will minimise the chances for dispute and makes things straightforward for your staff. So before you take on any new employees, make sure that you're familiar with the law and that your company has a defined policy on paid leave.

By Dan Whitelegg