Understanding the Law on Carrying Over Annual Leave

By Matthew Reymes Cole
31 May 2023

All workers are entitled to take at least 5.6 weeks of leave per leave year. This is pro-rated for part-time staff. Whilst it’s usually up to you if you permit them to carry 1.6 weeks of this into the next leave year, in normal times you must provide them opportunity to take at least four weeks per year.

The impact of COVID-19 may mean it is difficult for workers to take all their statutory annual leave entitlement. Demand at work might mean that taking annual leave is not feasible.

So what can be done?

absence leave someone marking off time for annual leave

Annual leave

The government’s response

Earlier in the year, the Government amended the Working Time Regulations 1998. This amendment gives workers the statutory right to carry over four weeks of annual leave into the next two leave years. Carrying over the remaining 1.6 weeks, and any additional leave your company provides, remains at your discretion.

When can an employee do this?

There is certain criteria that a worker must fulfil to be able to carry leave over in this way. It must not be reasonably practicable for annual leave to be taken in the leave year to which it relates as a result of the effects of coronavirus. This includes effects on the worker, the employer or the wider economy or society.

This means that there is no automatic right to carry leave over and you will need to consider the ‘reasonably practicable’ element.

What counts as reasonably practicable?

For assistance, Government guidance was produced on 13 May 2020. This sets out that you should take account of various factors, including:

  • whether the business has faced a significant increase in demand due to coronavirus that would reasonably require the worker to continue to be at work and cannot be met through alternative practical measures
  • the extent to which the business’ workforce is disrupted by the coronavirus and the practical options available to the business to provide temporary cover of essential activities
  • the health of the worker and how soon they need to take a period of rest and relaxation
  • the length of time remaining in the worker’s leave year, to enable the worker to take holiday at a later date within the leave year
  • the extent to which the worker taking leave would impact on wider society’s response to, and recovery from, the coronavirus situation
  • the ability of the remainder of the available workforce to provide cover for the worker going on leave

The guidance also provides insight on workers who are on furlough. This is particularly important now that the Job Retention Scheme is available until March 2021. The guidance states it’s not practicable for a worker to take annual leave whilst on furlough if you can’t provide normal pay.

Encouraging leave

You should do everything reasonably practicable to ensure that the worker is able to take as much of their leave as possible in your leave year. Where leave is carried forward, it’s best practice to give workers the opportunity to take a holiday at the earliest practicable opportunity.

Where leave is carried over, you can only reject a request to take carried-over leave where they have ‘good reason’ to. No further definitions or examples of what will or will not be deemed good reason have been given.

The guidance states that it is not likely that furloughed workers will need to carry leave over because of the ability to take annual leave during furlough.

Expert support

This issue is an unprecedent employment law challenge. To ensure you don’t fall foul of this challenge, get expert support from one our advisers today on 01455 858 132.

About the Author

Matthew Reymes-Cole

Matt joined Croner in 2007 as an employment law consultant and has advised clients of all sizes on all aspects of employment law. He has worked within management positions since 2017 and currently oversees a team within the litigation department, whilst continuing to support a number of clients directly.