Queen's Diamond Jubilee holiday – are you prepared?

To mark 60 years of the Queen's reign, there will be a special bank holiday to celebrate the Diamond Jubilee on Tuesday 5th June 2012. The celebrations will centre around an extended four-day long weekend with the late May bank holiday being moved to Monday 4th June 2012.

Carol Smith, Croner's Senior Employment consultant advises: "While most employers welcome the extra day as much as their staff, there could be challenges if you're not prepared. Some of the questions we have been asked by employers include whether they have to grant the time off, and if they do, whether employees should be paid. The short answer is it really depends on what is written in their contract of employment.

Some contracts may simply state that the employee will receive four weeks' annual holiday per year plus bank and public holidays - or inclusive of bank holidays – sometimes referred to as statutory days. If this is the case, then any newly declared bank holidays, such as the Diamond Jubilee may well be included within this clause. Alternatively, some contracts may simply state that the employee is entitled to 5.6 weeks annual holiday inclusive of bank and public holidays, in which case, if the employee wishes to take leave on the additional bank holiday, it will have to come out of their remaining holiday 'allowance'.

If however, the contract is more specifically drafted and it refers to each bank or public holiday by name, for example, Christmas Day, Good Friday and so on, the extra bank holiday will not be provided for in the contract. Therefore it will be up to the employer to make a decision about that day – whether to trade or not and whether the day off will be paid or unpaid. In the event that employers decide it will be "business as usual" but employees wish to take a day's holiday they can request to use a day of their annual leave entitlement. Employers should then review business needs and decide in advance how many employees can be absent on this day. Any requests for holiday should normally be dealt with on a first come first served basis.

Conversely, should a business wish to close down for the day and employees are not entitled to bank holidays and do not wish to take one of their days – the employer can, under the Working Time Regulations 1998, serve the employee with no less than two days' notice forcing them to take a day's annual leave from their entitlement on that date. In practice, rather than leaving it to the last minute, it would be sensible for employers to set out any compulsory shut down periods, including this additional day, at the start of the leave year." Whatever option you choose, you will need to ensure that you do not unlawfully discriminate against employees because of one of the characteristics protected under the equality act or because of their part time status.

Those employers that can afford to grant the additional bank holiday as a paid day's leave even if the contract does not provide for it, can use this as a good will gesture and this may be well received from an employment relations perspective, particularly in the current economic climate where it may be difficult to award pay rises or bonuses. However, if you decide not to allow employees the additional day, you need to consider and be prepared for any potential employee relations or adverse publicity implications.