Holiday Pay & Entitlement – Employment Law

What is my holiday entitlement?

Legally you are entitled to 5.6 weeks of paid holiday each year as a minimum. This is equal to 28 days including Bank Holidays. Holidays must be taken when it is convenient for your employer; there is no legal right to take holiday when you choose. You are not entitled to make the decision to take payment in lieu of holiday unless your employment has been terminated. Upon termination of your employment, you are entitled to any untaken holiday for that year. Alternatively, your employer may state that any remaining annual leave that you have will be taken during your notice period if you are working one or placed on garden leave.

Commission & Holiday Pay

Following publication by The Employment Appeal Tribunal (EAT) of their decision in Lock v British Gas, it was confirmed that holiday pay should be calculated to include all elements of normal remuneration for certain workers. Previously, some workers who relied on commission and overtime would lose a significant amount of money when taking annual leave that they are entitled to. Employers now have to take into consideration regular overtime and commission payments when calculating holiday pay. Holiday pay should include the following:

• Contractual, results-based commission (for other types of commission, the law is still unclear),
• Guaranteed, compulsory overtime,
• Non-guaranteed, compulsory overtime if this is regularly worked (irregular overtime is still unclear),
• Voluntary overtime where this regularly occurs,
• Possibly performance bonuses (discretionary bonuses probably not; contractual bonuses probably yes),
• Possibly some allowances (e.g. travel allowances, travelling time payments, standby and on-call allowances too, that form part of ‘normal remuneration’).

Part-Time Workers Holiday Entitlement

As a part-time worker, you are entitled to a minimum of 5.6 weeks of paid holiday a year. However, this is calculated on a pro-rata basis. For example, for a 3-day working week, your holiday days would be calculated by multiplying 5.6 by 3. This means you would have 16.8 days of paid annual leave.

What notice do I need to give to my employer before taking holidays?

This depends on what is laid out in your contract of employment. But the general rule is that you need to give twice the amount of notice for the amount of holiday you wish to take. For example, 2 weeks of notice is required for 1 week of annual leave, or 2 days of notice to take 1 day off.

Can my employer refuse my holiday request?

Your employer can refuse your holiday request as long as they provide the same amount of notice as the amount of annual leave that you have requested. For example, if you have requested for 2 weeks of annual leave, your employer must also provide 2 weeks notice for refusing the request.

Whilst employers are entitled to refuse a holiday request at certain times, they cannot refuse to let you take your minimum entitlement for the year. Employers are also entitled to tell their staff to take leave on certain days of the year. Typically bank holidays and the Christmas period.

Will I be paid for Bank Holidays?

Your employer can choose to include Bank Holidays in your 28 days paid holiday (assuming you work 5 days a week). There is no statutory right for an employee to be paid for public holidays on top of the 28-day entitlement. However, it is dependent on the terms of the contract of employment which may state something different.