Managing back-logs of annual leave

Whether employees have been on furlough, been in the fortunate position that the business they work for has been incredibly busy but not being able to take time off, or having to cancel annual leave because they couldn’t travel, managing a back log of annual leave is one of the employment side effects of COVID-19.

With the end of the year in site, there will be many employers wondering what to do about this challenge and considering their options – particularly if you’re worried about employees taking their holiday all at the same time.

As an employer, you can require an employee to take, or not take, holiday on specific dates, and there have been some changes in the law due to COVID which may also help.

Can employees carry forward holiday?

Yes. Emergency legislation came into force which means that if employees couldn’t take annual leave because of the COVID-19 pandemic, they’re able to carry it forward to the next leave year. This applies to the minimum 4 weeks afforded under the Working Time Regulations, which previously, employees were not permitted to carry forward. This does only apply where it hasn’t been “reasonably practicable” for the employee to take their holiday in the current leave year and the government guidance states that employers should do everything reasonably practicable to ensure that the worker is able to take as much of their leave as possible in the year to which it relates.

It’s important to be very clear with employees who carry leave forward when they are expected to take it – they have up to 2 years to use that leave but you can require them to take carried over leave first.

Can employers require employees to take holiday at a specific time?

Yes – provided you follow contractual and/or statutory requirements. The employment contract might permit the employer to require an employee to take unused holiday during a period of notice or even at a specific time (e.g. Christmas shut down). If there is no such contractual provision then employers can rely on the statutory notice provisions where you give twice the amount of notice as the length of holiday you want the employee to take, e.g. 4 days’ notice to take 2 days holiday.

Many businesses may be quieter over the winter in particular or because of the impact COVID-19 has had and you might decide to give staff notice to take holiday at specific times before the end of the year – whether in rotation or as a result of a complete shutdown.

Can employers buy back holiday?

If you provide holiday in excess of the minimum statutory entitlement, you could look at buying back the extra holiday, so you’d pay it out to the employee without them taking the time off. It’s likely to be an attractive option if the employee has a high amount of accrued holiday and the value of them working outweighs the additional payment.


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