More Holidays!?
We have recently been inundated with questions from employers confused about the forthcoming increase in holiday entitlement. This article aims to alleviate the confusion!
The Working Time Regulations 1998 (the Regulations) set down minimum annual leave entitlements for the first time. The current entitlement is four weeks paid leave each year which can include public holidays. Employers who provide this minimum entitlement are therefore giving workers only 12 days leave which they can choose when to take.
The government made a manifesto commitment to ensure that paid time-off for bank holidays is in addition to the current four-week holiday entitlement under the Regulations.
Between June and September 2006 the government consulted on proposals and published draft regulations in January 2007. The initial proposal was to increase the statutory entitlement in two stages by way of an increase to 24 days on 1 October 2007 and to 28 days on 1 October 2008. Following further consultation and campaigning from employer groups the government has now revised that proposal so that the second stage (increase to 28 days) will be delayed until 1 April 2009.
The changes therefore take effect by way of increases to:
- 24 days on 1 October 2007; and
- 28 days on 1 April 2009.
This increased entitlement can include public holidays.
So, what impact will the increased entitlement have?
The good news is that many employers already allow at least 20 days plus public holidays to their workers. These employers already provide sufficient holiday, even when the full 28 day entitlement comes into effect!
Those who will be affected are those employers who currently only allow 20 days holiday inclusive of public holidays. The TUC have estimated that 6 million workers will benefit from the increased leave entitlement.
As a result of representations from employer groups about the effects on businesses, a transitional measure has been agreed whereby a payment in lieu can be made for the additional leave entitlement only (the four extra days) introduced from October 2007 until 1 April 2009. This measure will end on 1 April 2009.
The increased entitlement remains subject to whatever restrictions employers choose to impose on when holiday can be taken. They may choose to have specified shut down periods (the usual being between Christmas and New Year) when workers have to take annual leave. Employers may also want to set limits on the maximum amounts of leave which can be taken on any one occasion and also the periods when leave may or may not be taken. These restrictions should be expressly stated in the contract of employment. It is also essential to have clear rules laid down detailing the policies and procedures governing the use of holiday entitlement.
The future for holiday entitlement up to April 2009 is therefore set. What happens beyond then is not yet known. The increasing trend with almost every new piece of employment legislation is to harmonise the UK with the rest of Europe. Even after the increase to 28 days holiday the UK will still provide the joint lowest holiday entitlement in the European Union. Germany currently provides the highest entitlement of a staggering 39 days a year (inclusive of Bank Holidays). Will the UK eventually try to match this? Watch this space…
Raworths run bi-annual employment seminars for employers. The next seminars take place on Tuesday 25th and Thursday 27th September. If you would like more information about these, please contact Pauline.Sellers@raworths.co.uk.
For further information contact Sally Archibald on 01423 566666 or by email sally.togher@raworths.co.uk
