That holiday feeling

The government has put forward draft proposals to increase the statutory entitlement to paid holiday for all workers from the current 20 days to 24 days from 1 October 2007 and then to 28 days from 1 October 2008. Part-time workers will be entitled to receive a pro rata proportion of those figures.

The proposals are still in draft form and the DTI will consult on them until 13 April 2007. But their substance is not expected to change, whatever the outcome of the consultation. This is a big issue for the construction industry, where about 200,000 workers get fewer than 28 days’ leave, as such workers would be legally entitled to more holiday in the near future.

When the Working Time Regulations 1998 were enacted, they were designed to give all workers the four weeks’ paid holiday they were entitled to under the European Union’s Working Time Directive. However, due to the way that the regulations were drafted, the minimum entitlement in the UK can include the eight bank and public holidays enjoyed by UK citizens, such as Christmas Day. This has the effect that some full-time workers currently only receive 12 additional days of holiday on top of bank holidays. This is far less generous than the entitlement of workers in countries such as Germany and has led to trade union pressure for a change to the law.

Under the draft regulations there will be no automatic right for workers to take time off on specific dates, such as on bank holidays. This is sensible, as workers cannot realistically have an unfettered right to take time off whenever they choose, irrespective of their employer’s business demands. For instance, hospitals still need doctors and nurses to work on Christmas Day.

However, the ability for employers and workers to agree in their contracts that specific days will be taken as holiday will remain. This appears to give employers maximum freedom to determine periods when leave must be taken. But the proposals also suggest that if a worker is required to take leave on a specific date and the worker is ill on that date, the leave can be taken on another day. Workers will be allowed to carry over any surplus unused holiday into the next year where this is provided for in their contracts.

Workers cannot realistically have an unfettered right to take time off whenever they choose

The Working Time Directive guarantees a worker four weeks of paid holiday each year, and the regulations mean that employers cannot prevent their workers from taking that leave. Part-time workers will be entitled to a pro rata increase in their current statutory annual leave. This is calculated on the basis that “a week’s holiday” is the number of days a week that the worker usually works. For example, one week’s holiday for a worker who usually works three days a week will be three days. Workers who work more than five days a week accrue statutory holiday in the same manner, but the statutory minimum number of days holiday will be capped at 28. However, employers are free to give such workers more holiday if they wish.

As with the present regulations, employers will not be entitled to pay workers in lieu of untaken leave, except on termination of their contract. Although this curtails employers from adopting a fully flexible leave policy, it provides protection to workers from pressure to “sell” their holiday entitlement.

The draft regulations therefore seem to have anticipated most of the possible consequences of raising the holiday entitlement. They appear to have provided the intended additional protection for workers, while allowing employers the flexibility that they currently enjoy to determine when leave can be taken.

However, employers with vaguely drafted employment contracts should also beware: some clauses could result in workers receiving a windfall entitlement. For example, any contract giving a worker “statutory minimum holiday entitlement, plus bank holidays”, could be argued to mean that the worker is entitled to 36 days of holiday from October 2008. The freedom from stress and worry which holidays are designed to provide may sadly go missing in any such dispute.