July 2007

28 Days Holiday Entitlement – But Not Yet

A couple of months ago we reported on the government’s proposal to increase the minimum statutory holiday entitlement from the current 20 days (including bank holidays) to 28 days (bank holidays inclusive). The 28 days equates to 5.6 weeks for an employee working a five day week.

The government has recently published its response to the further consultation and the regulations are making their way through parliament. Parliamentary approval should be forthcoming by the end of June which will give employers three months notice to implement the changes.

Following the consultation some amendments have been made. The main change is delaying when employees will be entitled to the full amount of additional leave.

The government will delay introducing the second increase from 4.8 to 5.6 weeks until 1 April 2009. This will increase the holiday entitlement of an employee, who works a five day week, from 24 days to 28 days leave. Apparently there has been pressure from the health and social care sector, which has led to the government proposing the later date. The original proposal had been to introduce the change from 1 October 2008.

The initial increase from 4 to 4.8 weeks, or 20 to 24 days for an employee who works a five day week, will come into effect on 1 October 2007, as originally suggested.

The government have amended the proposals to enable employers to pay employees for the additional holiday entitlement (the additional 0.8 weeks or 4 days) until 1 April 2009. This is a temporary measure to ease the transition.

The increased leave entitlement includes bank holidays, so employees who already get four weeks leave plus bank holidays will not be entitled to an increased entitlement.

Part time workers minimum entitlement will be calculated on a pro-rata basis (4.8 then 5.6 times their usual working week), regardless of whether or not they usually work on bank holidays.

Increases from October 2007 and April 2009 will be calculated proportionally depending on when the leave year starts. The DTI’s announcement includes the following example.

‘If your leave year started in April, you work a 5 day week and you currently receive 20 days including bank and public holidays, you will be entitled to 2 additional days from October 2007 to March 2008.’

The government also state that they plan to cap the maximum statutory holiday entitlement at 28 days, but that employers may give more contractual holiday than that if they choose. Also some or all of the additional holiday may be carried forward to the following leave year with the agreement of both the employer and employee. Payment in lieu of additional holiday will not be permitted from 1 April 2009 unless paid on termination of employment.

The DTI will make an online calculator available shortly and we will let you have the link for this as soon as it is available.

These proposals relate to England, Wales and Scotland. The Department for Employment and Learning in Northern Ireland are in the process of making proposals for Northern Ireland.

Internet links:

DTI annual leave press release and to be kept informed of developments email annual.leave@dti.gsi.gov.uk