As 2023 approaches, so does the end of the calendar year for many businesses. If your business calendar runs from January – December, you should organise and reconcile matters like remaining annual leave now.
Employers must provide full-time workers with a minimum of 28 days of paid holiday per year. The minimum is stipulated by the law and is known as statutory leave entitlement. Employers can allocate their staff as much annual leave as they like, as long as it aligns with the legal minimum.
What happens if my employee has annual leave remaining at the end of the year?
The end of the year is approaching, and it may be the case that employees have days to take, but not enough time to use the holiday. It is a legal requirement that employees must use at least 28 days (5.6 working weeks) of their annual leave each year. Employees must have taken the legally required amount. Only holidays that are in addition to the legal requirement can be carried over. The employee’s entitlement to carrying additional holidays over to the next working year is dependent on their contract.
Many employers stipulate in contracts that holidays must be taken before the year’s end. But similar to many HR issues, it isn’t always a one size fits all situation.
If your contract states that employees cannot carry holidays over, you can
- Maintain your position and enforce that holidays cannot be carried over.
- Allow the employee to take over a percentage of holidays into the following year. In this case, you can require that the employee take the dates in a certain time frame (ie three months)
- Allow the employee to carry over all remaining holidays. You can again, require that the holidays are taken within a certain time frame, or by taking specific dates.
- If you can, you can take preemptive action and require the employee takes specific holidays. Employers have the right to enforce annual leave as long as they give double the notice.
What if my employee has been absent or unable to take their holidays?
In some cases, an employee may not have been physically able to take their holidays. If an employee has been on maternity leave or has been absent due to illness or disability, they have the right to carry over the remaining annual leave.
Are there any other circumstances that would allow employees to carry over annual leave?
There may be some exceptional cases that would mean employees have the right to use remaining annual leave such as prolonged jury service.
Employers should actively encourage employees to use their annual leave, over the course of the year, to avoid a lump amount remaining at the end of the year. It is good practice to regularly do this both verbally, and via communications like email.
Where do you organise annual leave and sickness in your business? Issues like remaining holidays often occur when businesses lack organisation in their HR Department. At NORI HR and Employment Law, we work with Breathe HR to provide businesses with seamless HR from advice to employee management. Find out more information and benefits of software like this here.