What Happens to Annual Leave if Employees are Poorly on Bank Holidays?

Guidance for Employers

What Happens to Annual Leave if Employees are Poorly on Bank Holidays?

We know that this is now our third blog post in fairly quick succession on holidays but it’s a topic that we get a lot of questions about.  This post covers quite a specific area of holiday leave, providing insights into managing an employee’s sick leave when public and bank holidays are included in their holiday entitlement.

What Happens to Annual Leave if Employees are Poorly on Bank Holidays?

6 June, 2017

by Kristina Lukaviciute

We know that this is now our third blog post in fairly quick succession on holidays but it’s a topic that we get a lot of questions about.  You may be thinking – is there really anything else left to say about the whole holiday/bank and public holidays topic?

I can assure you I wish this was the end of the saga but to your and actually my surprise – there is one more thing!

1. Bank and Public Holidays in an Employees’ Normal Holiday Entitlement

We have discussed in two previous blog posts (“How To Calculate Employee Holiday Correctly” and “Tips to Avoid Issues with Contractual Holiday“) that if an employer includes the bank and public holidays in the statutory minimum of 28 days FTE annual leave entitlement for employees then these days form part of the employees’ normal holiday entitlement and need to be treated that way.

Therefore, the bank and public holidays:

  • form part of the holiday accrual system and are reflected in any part-year holiday calculations for starters/leavers;
  • are included in any holiday entitlement carry over for maternity and shared parental leave periods.

2. What does this mean in practical terms when we consider Sickness Leave?

It might not be something that employers or even employees are used to thinking about but when bank and public holidays are part of normal holiday entitlement and employees fall ill on these days, they should be allowed to take the paid holiday time off at another time.

The entitlement to being allowed to take holidays on another day if an employee is on sick leave during a scheduled annual leave was established in the case of Pereda v Madrid Movilidad SA in 2009. This effectively means that if an employee is ill on a bank and public holiday, they should be given another day that they can take as paid time off.

Where employers include bank and public holidays into employees’ normal holiday entitlement, the usual scenario is that the business itself is closed on a bank and public holidays and therefore it makes sense to have employees off as well. But if an employee falls ill on a bank or public holiday and therefore needs to be given another day to take as leave, this means that now a business needs to release an employee from their duties on a day when the business is actually operating. This unfortunately creates a need for cover and additional operational planning to take place.

3. Is this actually an issue for businesses?

Bank and public holidays have always carried a number of ‘common’ incorrect believes around them including the aspects of whether employees have a right to time off on them, whether the time off should be paid or unpaid, etc. This is probably why employees are accustomed to simply viewing them slightly differently from the normal leave entitlement in the company’s HR policies and therefore the scenarios outlined above probably do not take place often.

However, just because this has not been an issue in the past does not mean it might not become one – as it certainly does have the potential. And I wonder if there is a business that would like to be tested on this through the tribunal system!

4. So how should employers best handle bank and public holidays?

Those employers who include the bank and public holidays into the employees’ statutory minimum holiday entitlement, could simply treat these days in the exact same manner as other holidays. This would help minimise any confusion or ‘misconceptions’ about these days in employee eyes.

What I mean by ‘treating these days in the exact same manner as other holidays’ is to apply the same holiday booking / cancelling / rescheduling process to them.

So, if your employees are full time, you would give them their entitlement to 28 days and would advise them that you want them to take 8 of these days on the public and bank holiday days. You would then also require them to record this on their holiday booking records, this way each bank and public holiday would be processed in the same manner and this would be reflected on the employee records.

Treating them exactly the same as other holiday days, would also ensure that any potential sickness during a bank or public holiday scenarios can be handled with more clarity. It would also avoid the risk that many employers still face of not paying employees their full accrued holiday amount upon termination.

5. “No more holiday talk” I hear you scream!

OK, I promise that this is the final post on bank and public holidays for now!

That is until case law throws something new at us and we will be back to the same starting point of confusion as before.

And in the meantime, if you feel like ‘giving up’ the minute an employee mentions holidays (bank or public or statutory – anything!) – we are here to take that burden off you or help you navigate these confusing waters.

Why not give us a call on 0203 319 1649 and one of our consultants will help ‘lighten’ your load!

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