Easter headache for some employers

Employers who have a holiday year that runs from 1 April to 31 March and contracts that provide for ‘20 days holiday plus bank holidays’ are at risk of breaching their employees’ annual leave rights in the 2016/2017 holiday year.

In 2015, Good Friday and Easter Monday fell on 3 April and 6 April. This year, they will fall on 25 March and 28 March. This means there will be two Easter weekends in the 2015/2016 holiday year giving a total of 10 bank holidays.

In 2017, Easter returns to April meaning there will be no Easter weekends and only 6 bank holidays in the 2016/2017 holiday year.

Employees have a right to a minimum of 5.6 weeks’ annual leave every year. This equates to 28 days for employees who work a 5 day week. The 28 days can include bank holidays. With the way that Easter falls over the next three years, employees who have a contractual entitlement to ‘20 days plus banks holidays’ will only be entitled to 26 days’ leave in the 2016/2017 holiday year. Employers will need to take steps to ensure they do not breach their employees’ minimum right to 28 days annual leave each year.

What steps should employers take?

The Working Time Regulations provide that employers can only pay an employee in lieu of holiday on the termination of their employment.  Payment in lieu is therefore not an option.  Instead, employers should consider carrying out one of the following options:

-       Allow employees to take two extra days leave for the 2016/2017 holiday year to meet the 28 days minimum entitlement.

-       Consider moving the holiday year to January – December.

-       Consider changing the wording in the employment contracts to say employees are entitled to ‘28 days holiday inclusive of bank holidays’.

Employers should be aware that options 2 and 3 involve contractual changes and therefore should not be carried out without seeking legal advice first. An employer that imposes a contractual change without the agreement of their employees will be in breach of contract.

Emma Clements