Holidays 2022: annual leave entitlement, an additional bank holiday and unlimited leave queries

What is the basic annual leave entitlement for workers?

In England and Wales, all full-time workers have a right to 5.6 weeks’ annual leave per year, equating to 28 days’ holiday (per the Working Time Regulations 1998). A part-time or zero hours worker is entitled to 28 days’ holiday reduced pro rata, based upon the number of days worked each week.

Employers can choose to offer more favourable holiday entitlements (i.e. offering employees more holiday than their statutory entitlement), and often do, as an incentive or perk of employment.

Are workers automatically entitled to the additional bank Queen’s Platinum Jubilee Bank Holiday?

Workers do not have a statutory right to take time off on bank holidays; they may be required to work on bank holidays, or their employer may agree they can take bank holidays off as paid leave. This is a matter for agreement with the employer and should (and ordinarily is) set out in the contract of employment.

In November 2021, the UK Government announced that an additional bank holiday would be granted to celebrate the Queen’s Platinum Jubilee, to take place on Friday 3 June 2022.  This means that there will be 9 rather than 8 bank holidays in 2022. The late May bank holiday has been moved to Thursday 2 June 2022 to create a special ‘four-day weekend’ for many. The last time additional bank holidays were granted were for the royal wedding in 2011 and the Queen’s Diamond Jubilee in 2012.

Employers and employees alike should carefully consider the wording of their employment contracts to determine if they are automatically entitled to this additional bank holiday. For example, if the contract states that a worker is entitled to annual leave comprising “20 days plus the usual bank holidays”, this would not automatically entitle an employee to the extra bank holiday; the additional bank holiday this year not being the “usual” 8 bank holidays. If the contract states “28 days per year”, again the worker would have no right to an increase in leave for the year to account for the additional bank holiday. Whereas, if the contract states “20 days plusbank holidays” this would grant the worker the right to time off on this year’s additional bank holiday.  In the latter example, the wording in the contract is not limited to the “usual” bank holidays, meaning the worker has an entitlement to paid time off on allbank holidays, including any which are additional to the usual dates (such as the Jubilee bank holiday).

Where there is no automatic contractual entitlement for employees to take the additional bank holiday, it is within the employer’s discretion to grant this as a day’s paid holiday (or to grant time off in lieu).

If the contract is silent on bank holidays or the employer is considering using its discretion to grant leave as goodwill (where otherwise the worker has no right to it), employers should be mindful of business needs and the fair and equal treatment of its workers. Due consideration should be made for the cost of granting any additional leave to workers (though it should be a manageable one), with the damage that may be caused to goodwill and relations for workers by refusing to, especially if the business closes on this day. In any event, it is good practice for an employer to communicate in advance and to give notice to workers of their entitlement (or not) to this additional bank holiday.

Employers should remember that workers on maternity leave continue to accrue annual leave and may, depending on the wording of their contract be entitled to an extra day’s leave for the extra bank holiday (if the contract provides for it) when calculating accrued annual leave due to them for 2022. Part-time employees who do not normally work on a Friday may ask for an additional day of holiday if their full-time colleagues (or part-time colleagues who do work on a Friday) are granted the additional bank holiday. Part-time employees are protected in law from suffering a detriment due to their part-time status (and/or any caring responsibilities they may have, if applicable) and women on maternity leave are protected from discrimination. Therefore, even if the contract wording does not entitle the employee to have the extra bank holiday, employers should consider the impact on all workers equally and may choose to grant the extra day to everyone to eliminate the risk of complaints and legal liability for claims.

Finally, there have been calls from business leaders to the Government to make the additional bank holiday permanent. Whilst, at the time of preparing this article the position remains undecided, it is important for employers and workers alike to take stock of their entitlements, and any contractual changes needed to give a right to the extra day if desired and to update any holiday policies.  

What is unlimited leave? Should employers implement it?

The Coronavirus pandemic has brought even greater focus on employee’s wellbeing and mental health. Agile and hybrid working arrangements have been at the forefront of employment relationships in recent months, and additional holiday entitlement is being considered an advantageous benefit to employment (and incentive for employees) now more than ever. There has been a raft of employers offering to enhance their standard holiday policies, with unlimited leave to account for workers’ mental health. Is the move towards a more flexible ‘unlimited holidays’ policy the way forward for employers, and is it as good as it sounds?

In theory, an unlimited annual leave policy allows for employees to take as much or as little annual leave in a year as they like. The idea of unlimited leave originates in the US and has grown increasingly popular in the UK, with companies such as Netflix, LinkedIn, and Glassdoor taking this approach. The uptake is expected to continue to increase over the coming years, especially in light of the flexible working arrangements which have largely resulted from the Coronavirus pandemic.

There are various pros and cons to be considered before implementing an unlimited leave policy. Benefits can include the positive impact on wellbeing and mental health for employees, improved productivity across the workplace, and recruitment and retention rates can increase with the perk of unlimited leave attracting and keeping the best talent. Downsides may include a level of resentment and unfairness across the workplace, with varying amounts of leave taken by different individuals, ambiguity of what an acceptable level of holiday per year is, causing increased anxiety for employees, and increased strain on other employees who may have increased workloads during extended holiday taken by colleagues (without adequate planning).  It has been suggested that unlimited holiday policies can actually result in fewer holidays being taken, as staff can be anxious about not knowing the boundaries of what is appropriate to take and may simply continue taking their previous maximum entitlement only.

If you are an employer considering introducing an unlimited leave policy, it is fundamental that it is thorough, well considered, and deals with the legal and practical implications of unlimited holiday. For example, employers could consider including the following in the policy: minimum performance targets being set as a pre-requisite; the rights to reject leave requests at certain times of the year or when the business needs cannot support it; conflicting requests between key individuals and ensuring everyone is treated equally; a maximum number of days that can be taken in a block; notice periods for leave requests (e.g. double the period of the request); how carry over of holiday will work; and how under-performing individuals will be effectively managed – will an extended holiday extend any performance improvement plan?

This type of policy will not work for all employers and employees. Before implementing such a policy, it would be wise to engage and consult with employees to determine if there is any appetite for such a policy and the merits of introducing one to the workforce. If a policy is introduced, it should be encouraged and to be used properly rather than a simple marketing tool. Employers should be trained to ensure that discrimination doesn’t arise; for instance, granting more leave for one group of individuals over another. Tailored legal advice and training is advised.

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