[Mythbuster] Employees Don’t Accrue Holiday While on Furlough

With everything that’s been going on the past few weeks, it can be difficult to keep up with all of the updates that have been flooding in.

You’re probably aware of the term ‘furlough’ by now. You’ve also probably heard that statutory sick pay (SSP) is payable from day one of absence. But you might have missed a major update—the amends to the Working Time Regulations.

Why the change?

The regulations have been amended to allow more flexibility when dealing with annual leave. Due to these unprecedented circumstances, many workers might struggle to take all of their leave entitlement before the end of the year.

There are a number of reasons why individuals might struggle to take their full entitlement, including:

• Self-isolating and/or too sick to take their holiday before the leave year is over
• They’ve been laid off or furloughed
• They’re a key worker, so had to continue working and couldn’t take paid holiday

Naturally, employees in these circumstances would want to carry over this leave if possible. The government has taken this into account and provided an appropriate measure to tackle it.

So what are the changes?

The latest change means that workers now have the right to carry leave over into the next two leave years.

Just as a refresher, workers have a statutory right to 5.6 weeks leave under the regulations already. Now, with this change, you could have employees with 11.2 weeks leave entitlement next year.

Workers already had a statutory right to carry over 1.6 weeks with the agreement of the employer. The latest updates don’t change this.

So that means leave accrued will be carried over like this:

• 4 weeks (legally entitled to carry over the next two years)
• 1.6 weeks (employers can already agree that this be carried over into the next leave year)
• Any enhanced contractual entitlement (at your discretion)

That’s not the only amendment. The rules on pay in lieu of untaken annual leave have also changed. Now, when an employment contract is terminated, holiday pay will include anything carried over and not taken due to coronavirus.

What about accrued holiday entitlement?

Workers will accrue statutory minimum annual leave as normal during furlough.

Employment law during these challenging times can be difficult to get your head around. If you require support or guidance, speak to a Croner expert on 01455 858 132 or contact us online and arrange a call back.