Taking leave is on the up
Employees’ minimum holiday entitlement is set to increase to 28 days (5.6 weeks) – including entitlement to bank holidays – on a phased basis over the next two years, under the Working Time (Amendment) Regulations 2007.
Since 1998, full-time workers have been given the right to a minimum of 20 days (four weeks) leave a year, although employers could include the eight bank holidays within this figure.
The change is taking place in two phases. From 1 October 2007, the statutory minimum annual holiday entitlement for full-time workers will rise from 20 days to 24 days (4.8 weeks). Then from 1 April 2009, a second increase will bring the entitlement up to 28 days.
The rules also apply to employees working part-time, shifts and term-time only – with leave apportioned on a pro-rata basis, as previously. The increase between October 2007 and April 2009 will be calculated proportionally, depending on when a leave year starts. So, for example, if a leave year starts in April and an employee works five days a week, then their entitlement will increase by two days from October 2007 to March 2008.
Some employers already provide generous contractual holidays that exceed the new minimum, and they will not be affected. The changes only impact on employers who do not offer workers an annual leave entitlement of at least 28 days – pro-rata for those working part-time. In reality, this legislation will have little impact on employers already offering 20 days annual leave in addition to UK bank holidays.
As the new regulations benefit employees, this does not amount to a change in the terms of their employment and there will be no need to reissue contracts to staff. But where it means an increase in holidays, employers will have to inform staff in writing, for example, by letter or by a statement on the pay slip. Templates for informing staff of their entitlement are available from the Department for Business, Enterprise and Regulatory Reform website at: www.dti.gov.uk/employment/holidays/page41004.html
An employer is not allowed to replace an employee’s annual leave by making a payment in lieu except on termination of employment. However, as a temporary measure, to help employers make the transition to the new arrangements, between 1 October 2007 and 1 April 2009, employers can pay in lieu of the extra four days (0.8 week).