It’s been announced that workers who have not taken all their annual leave entitlement due to COVID-19 will be able to carry it over into the next two leave years. Alan Price of BrightHR explains what employers need to know.

How has Coronavirus (COVID-19) affected annual leave entitlement in the UK?

The government has announced that workers who have not taken all their statutory annual leave entitlement due to COVID-19 will now be able to carry it over into the next two leave years. 

This announcement is in recognition of the issues facing employers caused by employees' planned holiday being disrupted before the end of the leave year. This may be because employees:

• are self-isolating or are too sick to take holiday before the end of their leave year
• have been temporarily sent home as there’s no work (‘laid off’ or ‘put on furlough’)
• have had to continue working and could not take paid holiday

What do the new carry-over annual leave regulations mean?

The regulations now give workers a statutory right to carry leave over into the next two leave years after this one. This only applies to the first four weeks of leave under the Regulations (Regulation 13 leave).

The other 1.6 weeks of statutory minimum leave is already capable of being carried over to the next leave year with agreement from the employer, and the new laws do not change this.

This means that all statutory minimum annual leave accrued in this leave year is now capable of being carried over, in the following way:

• four weeks (legal entitlement to be carried over to next two leave years)
• 1.6 weeks (employers can agree that this be carried over to the next leave year)
• enhanced contractual entitlement (at employers’ discretion)

How has Coronavirus (COVID-19) affected pay in lieu?

The rules on pay in lieu of untaken annual leave have also been amended. This means when employment ends, the holiday pay payable will include anything carried over and not taken due to the Coronavirus carry over. However, the law still does not allow pay instead of statutory minimum entitlement at any time other than termination of employment.

What do businesses need to do to reflect the new carry-over regulations?

If employers do not already have a policy in place to deal with the carry-over of the additional 1.6 weeks of leave, it would be advisable to prepare one now so that everyone is aware of precisely what this means for them in terms of leave. Likewise, this should be done for any contractual entitlement over the statutory minimum amount. Many employers already offer a buy-back system of this element of entitlement.

About the author

Alan Price is a HR expert and CEO at BrightHR, a HR software and support firm offering cloud-based software which records employee absences, responds to annual leave requests, and creates shifts and rotas.

See also

What does the COVID-19 'lockdown' mean for UK employers?

Coronavirus (COVID-19): Important service announcement - changes to post and fax service

How will the new IR35 rules affect off-payroll working?

Find out more

Holiday entitlement (GOV.uk)

Rules on carrying over annual leave to be relaxed to support key industries during COVID-19 (GOV.uk)

The Working Time Regulations 1998 (Legislation)

Coronavirus (COVID-19): what you need to do (GOV.uk)

Common questions - Coronavirus (COVID-19) (NHS)

Image: Getty Images

Publication date: 1 April 2020