Holiday and Furlough

On 13th May 2020 the government issued guidance on holiday during Furlough. We have summarised that guidance here to help employers make decisions around holiday for their employees.

Key points:

• Holiday continues to accrue during periods of furlough
• Employers can require employees to take holiday during furlough
• Employers can cancel holidays which had already been authorised

Enforcing Holiday

Employers can enforce holiday during periods of furlough in the same way they can at any other time. The employer must give notice of double the length of the period of holiday to be taken. Notice must be given prior to the notice period starting.

As an example, if you require an employee to take one week of holiday then you must give two weeks’ notice. That notice must be given at least the day before the two weeks notice period starts - that is, in this example, 15 days prior to the first day of the holiday period.

Holidays must be enforced reasonably. Consider the impact of social distancing and not being permitted to leave the home on enjoyment of holiday. Balance this with the time to the end of the holiday year and the amount of that time that will be back at work. As an example, if the holiday year is January to December and the business does not open until July, it may be reasonable to require that 50% of the holiday entitlement is taken during furlough.

Cancelling Holiday

Holidays should only be cancelled by the business where it is business critical. For example key NHS workers may, during the COVID-19 crisis period, have had holidays reasonably cancelled. Where demand for your business has significantly increased or you have key workers, holiday may need to be cancelled. Do balance this with the needs of your employees to have a break and cost implications of them losing holiday.

If considering on balance that holiday needs to be cancelled then this can be done by given notice equal to the holiday you need to cancel.

Bank Holidays

There is no legal right to time off on bank holidays, however they can form part of the statutory minimum holiday requirement (5.6 weeks per year).

Where bank holidays are normally taken as holiday, this can be paid as holiday during furlough without breaking furlough. Alternatively you can permit employees to defer these days and take them at another time.

Holiday Pay

Holidays must be paid during furlough in the same way as they would be normally. Holiday does not break furlough and as such the furlough payment can still be claimed. Employers are responsible for topping up the pay to full pay.

Read our article on holiday pay for more detailed guidance.

Carry over of Holiday

Emergency legislation has been introduced to allow carry over of up to 4 weeks of the statutory holiday for up to two years where, due to coronavirus,it is not reasonably practicable to take the holiday in the current holiday year.

Employers are responsible for doing as much as is possible to ensure holiday is taken in the current year. It is expected that workers on furlough will not need to carry over holiday.

Article last updated: 14 May 2020