Are you taking your holiday entitlement?

The TUC report that over 2 million of us take less than the legal minimum holiday entitlement. I suspect that business owners and the self employed are major “offenders”. Does it matter, yes it does, here’s why.

The legal position

Failure to allow a worker to take holiday, by accident or design, could lead to a constructive dismissal claim. Furthermore, the courts are allowing untaken holiday to be reclaimed in the form of “back-pay”. This benefits workers who have not been informed previously of their right to take holiday. If you engage workers without allowing holiday, you could be running up a big bill.

Everyone, that includes workers as well as employees, is entitled to 5.6 week holiday in the year. It cannot be “carried over” nor can it be paid in lieu.

As it is an “entitlement” it has to be requested. Individual requests can be refused, on reasonable grounds, so long as there is still time left in the year for the worker to take the holiday.

Employer Solutions has a formula to ensure you can calculate a worker’s entitlement. This works even if the individual only works for you on an occasional basis.

The effect on productivity

One of my favourite quotes is a century old, it is from Daniel Guggenheim a US mining magnate – and a “Bill Gates” of his day.

“The executive who works 12 months a year only really produces 6 months of work. It is the executive who spends one or two months doing something else that is the one who truly produces 12 months of work”.

Business owners and the self employed should take particular note.

More recently, and closer to home, here is what Richard Branson has to say of staff on unlimited holidays: “they get their work done and the company is certainly not suffering. The company is benefiting from the fact that people who work for it enjoy what they are doing”

In the 1970s, when the Heath government temporarily enforced a three day week. Production scarcely faltered.

We pay people for their time, but it is what we receive in return that matters.

Enforcing holiday entitlement

Employer Solutions prepares contracts of employment for clients. In doing so it does not routinely add a requirement to take holiday. But it can be part of the contract of employment to require staff to take a number of weeks holiday. In the employee’s absence someone else is handling an employee’s emails or looking at the accounts. It is amazing what can be revealed!

Not everyone wants to take holiday. I remember one employee who, when I first took over as a Personnel Manager, had 48 days outstanding holiday . We used to joke that he was planning to retire early!

More seriously, though, the man concerned was a middle aged single man. His response to being pressed to take holiday was “what would I do?” It is not always practical to take charge of an individual’s personal life.

Nonetheless, it is wise to remind employees periodically of their holiday entitlement. An Employer Solutions holiday request form requires employees to declare (at each request) how many holidays they have taken. It also prompts them to say how many they have left. That provides a handy way of reminding to take that holiday entitlement.

Malcolm Martin FCIPD

Author Human Resource Practice

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