Can your employees carry over annual leave?

With the calendar year coming to an end, many businesses are already preparing for 2020. For a lot of businesses, that means a fresh annual leave calendar come January 1st.

It’s important not to jump too far ahead, however. For instance, have your employees received their statutory annual leave entitlements for 2019? Have you provided all other entitlements specified under your contract of employment? Do you allow your employees to carry over annual leave into the next leave year?

These are important questions, and ones we’re going to help you answer.

Christmas public holiday entitlements

For most people, Christmas brings a little break. For others, it can mean continued work due to their employer’s operational requirements. This usually occurs in the retail and hospitality sectors.

There are three public holidays over the festive period that you need to remember:

  • Christmas Day
  • Stephen’s Day
  • New Year’s Day

Asking staff not to take holidays during Christmas isn’t uncommon. This is because businesses experience increased workloads during the period. If you’re thinking of doing this, ensure you’ve complied with public holiday entitlement rules.

Staff who are required to work a public holiday are entitled to:

  • A paid day off within a month of the public holiday, or
  • an extra day of annual leave, or
  • a day’s pay.

Have staff taken their statutory annual leave?

Employees must be provided with the statutory minimum of four weeks’ paid annual leave within the leave year. This is in addition to their public holiday entitlements.

The statutory four weeks’ paid leave is, in fact, a health and safety requirement, and is provided to employees to ensure they receive sufficient rest and recuperation. You are not therefore permitted to pay employees in lieu of statutory annual leave.

The only exception to this rule is if the employee’s contract of employment is terminated during the annual leave year.

Does annual leave carry over into 2020?

Carrying over annual leave is at the employer’s discretion. If you provide employees with more annual leave than the statutory minimum under your contract of employment, it is up to you to decide whether or not employees can carry over their unused contractual annual leave into the next year.

Use it or lose it

There is one catch if you don’t allow employees to carry over their contractual annual leave.

If your employees haven’t taken their contractual annual leave during the leave year, you must be able to show that you informed employees of their entitlements and encouraged them to take their contractual holidays during the leave year.

Offering to pay staff in lieu of any unused contractual annual leave entitlements before the end of the leave year is an alternative way to deal with this issue and may suit employees better coming to the end of the leave year.

If you do allow employees to carry over contractual holidays into the next annual leave year, remember to update your 2020 annual leave balances.

If you would like further complimentary advice on annual leave from an expert, our advisors are ready to take your call. Call us on 01 886 0350 or request a callback here.

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