28 days holidays on the horizon
A change to the statutory minimum holiday entitlement for employees will see an increase from
4 weeks to 5.6 weeks per annum. It is planned that this will be phased in over
2 years with an increase each year.
The initial changes take place 1st October 2007.
CURRENT ENTITLEMENT
Under the current guidelines an employee is entitled to a minimum of 4 weeks paid holiday leave.
Therefore an employee who works 5 days a week would get a minimum of 20 days holiday (5 days x 4 weeks). An employee working 3 days a week would get a minimum of 12 days holiday
(3 days x 4 weeks).
This entitlement includes bank holidays, therefore if you are closed on these days the employee would need to take these days from their entitlement.
Therefore, say that there are 8 bank holidays in a year, the employee working 5 days a week would take this off their 20 days, leaving them with 12 days to take when they choose.
If a part-time employee works Mon, Tues and Weds in a week, they would probably have 4 bank holidays falling on a Monday, therefore their 12 days holiday are reduced by the 4 bank holiday days, leaving them 8 days to take when they choose.
ENTITLEMENT FROM 1ST OCTOBER 2007
Under the new rules an employee will be entitled to 4.8 weeks paid holiday leave. If your employees already get at least 4.8 weeks holiday including bank holidays, then they are getting the minimum holiday requirements and you are under no obligation to increase this.
Therefore an employee working 5 days a week will see his paid holiday entitlement increase to 24 days per year (5 days x 4.8 weeks). Again, this figure includes bank holidays, therefore based on 8 bank holidays a year the employee would have 16 days to take when they choose.
The employee working 3 days a week will get an increased paid holiday entitlement of 14.4 days (3 days x 4.8 weeks) and again the bank holidays can come off this figure.
ENTITLEMENT FROM 1ST APRIL 2009
From this date the paid holiday entitlement will increase from 4.8 weeks to 5.6 weeks per year.
Therefore the employee working 5 days a week will get a further increase to 28 days paid holiday a year (5 days x 5.6 weeks) with bank holidays coming off this figure, leaving the employee 20 days to take when they choose.
The employee working 3 days a week will get an increase paid holiday entitlement of 16.8 days (3 days x 5.6 weeks) and again the bank holidays can come off this figure.
IMPLEMENTATION
As of the 1st October 2007 an employee will not automatically receive an extra 4 days holiday, this will accrue in the same way as before. An employee working 5 days a week will therefore accrue the following holidays per month:
Holiday year from 1 April 2007 to 31 March 2008
1st April 2007 to 30th September 2007
5 days worked x 4 weeks entitlement = 20 days/12 months = 1.67 days per month
1st October 2007 to 31st March 2008
5 days worked x 4.8 weeks entitlement = 24 days/12 months = 2 days per month
Therefore, at the end of September the employee would have accrued 10 days (1.67 days x 6 months). At the end of October this would have increased to 12 days and so on until the end of March when 22 days would have been accrued.
You can make an agreement with your employee to make a payment in lieu of the additional holiday entitlement each year up until the 1st April 2009. Four weeks leave however must still be taken as holiday in each holiday year. From 1st April 2009 payment in lieu of the statutory holiday entitlement will not be permitted.
For more detailed information visit the following website: www.berr.gov.uk/employment/holidays/faq/index.html#four
If you have any further queries please call Mark Nicholas on 01772 907071.