Annual Leave Carryover: What Every Employee Should Know

An individual’s annual leave entitlement is an essential element of their employment. It provides them with an opportunity to recharge, benefiting both their well-being and workplace productivity. Unfortunately, though, not all employee holiday entitlement is taken each year, leading to questions concerning “carryover”.

In this article, we address the key facts every employee needs to know about holiday accrual. We then explore the laws surrounding carryover and what individuals should do if their rights are denied.

If you have any questions concerning your holiday rights or believe they’ve been breached, get in touch with us now. Redmans Solicitors are employment law specialists, and after a quick consultation, we can answer your queries and provide expert advice.

To begin, simply:

UK Employee Annual Leave Entitlement Explained

In the UK, full-time employees are entitled to at least 5.6 weeks of statutory paid leave annually. This equates to 28 days of holiday entitlement, eight of which are bank holidays. Employers may offer additional leave as part of their annual leave policy, but this isn’t legally required.

If an individual works part-time, they will have the same entitlement as their full-time counterparts; only their holiday accrual will be calculated on a pro-rata basis. To determine their allowance, employers would need to multiply the number of days they work each week by 5.6. For example, if an individual works three days a week, they would be entitled to 3 x 5.6, which equates to 16.8 days annually.

It’s essential to remember the entitlement to holidays for employees has no qualifying period. Thus, individuals begin accruing their annual leave entitlement from their first day of employment.

Typically, a “leave year” will coincide with the calendar year (January–December), financial year (April–March), or another agreed timeframe. However, if no timeframe has been specified, the leave year will default to the individual’s start date anniversary.

Why Employers Must Prioritise Their Annual Leave Policy

As mentioned, an individual’s annual leave entitlement isn’t just a legal right but a crucial mechanism to enhance health and performance. From an individual’s perspective, regular breaks can help reduce stress and enable them to spend time with their family. As for their employer, rested employees tend to work more efficiently, promoting a more productive workplace.

However, despite these benefits, a recent Timetastic survey revealed that 61% of UK workers failed to take their full employee holiday entitlement in 2023. This roughly equates to a shocking 20 million workers missing out on their rights.

Unfortunately, there is no single reason employees don’t use up all their holidays, which means employers must address many issues. While some individuals may save holidays for personal reasons like emergencies, others face challenges that prevent their use. Employers must focus on the latter of these reasons.

Sometimes, employees may feel overwhelmed with workload pressures, especially when their team is short-staffed. This can lead to concerns about falling behind, causing individuals to become hesitant about having time off. For others, there may be a cultural barrier where they feel an unspoken expectation to appear dedicated. 

Whatever the circumstances, given the benefits of rested employees, employers must act. Measures should be implemented to help mitigate the impacts of a skeleton crew and reassure employees they won’t fall behind. Employers should also effectively communicate the importance of taking leave, ensuring individuals don’t feel guilty about doing so.

Understanding Holiday Leave Carryover: Rules, Rights, and Employer Obligations

Annual leave carryover, sometimes termed “holiday rollover”, enables employees to transfer unused holidays from one leave year to the next. While statutory leave entitlements are legally established, carrying over unused holidays isn’t a legal right unless specific conditions apply. Employers, therefore, have the discretion to allow carryover as part of their annual leave policy, provided they remain legally compliant.

Can you Legally Carry Over Annual Leave?

UK employment law establishes that employee holiday entitlement can be carried over in specific circumstances. 

Firstly, if an employee couldn’t take their statutory leave because they were on sick leave, they can carry over up to four weeks. In such circumstances, they must use their annual leave within 18 months following the end of the leave year in which the entitlement was initially accrued. Should the individual miss out because of maternity or other family-related leave, they could carry over their full 5.6 weeks entitlement.

Alternatively, an employer’s policy may outline if and when holidays for employees can be carried over. This is especially relevant when an employer offers enhanced holiday entitlements. If they operate under a ‘use it or lose it’ policy, it’s likely no leave can be carried over unless other legal rights apply.

That being said, employers must remain legally compliant should they deny the workforce the chance to carry over leave. The final reason an employee could do so is if their employer fails in this legal obligation. Employers are legally required to ensure employees can take the holidays they’re entitled to. This means they must provide employees ample opportunities to take leave, encourage them to do so, and warn them that any untaken leave will be lost.

Can my Employer Refuse to Carry Over a Holiday?

Employers can refuse to carry over annual leave provided they don’t breach employment rights. If an employee wasn’t on sick or statutory leave, was given ample opportunities to take their holiday, warned about losing it, and has no contractual right to carry it over, the employer can justifiably deny the request.

What Happens to Unused Annual Leave?

What happens to an employee’s unused holiday leave will depend on their circumstances and the policy their employer has established. If they meet any of the above criteria, they will likely be able to utilise unused holidays in the following leave year. However, if none of the above apply, that holiday will be lost.

What to Do If Your Annual Leave Requests Are Unfairly Refused

Regardless of whether an employer permits holiday carryover, employees are entitled to take their leave within the relevant leave year. While employers can decline holiday requests, they must have a valid business reason and provide adequate notice. Importantly, employers are responsible for ensuring employees can use their full entitlement within the leave year.

If an employer repeatedly denies an employee’s holiday requests or fails to meet their legal obligations, they may be violating the employee’s rights. In such cases, the employee has several options to address the issue and seek resolution.

  • Firstly, the individual could pursue an internal remedy via an informal chat or formal grievance. In either case, stressful court action would be avoided, but raising a grievance would place additional legal responsibilities on the employer.
  • If this fails, the individual may want to consider initiating an employment tribunal claim. Before they do, they would have to complete ACAS early conciliation, and it’s recommended that they seek specialist legal advice.

If your annual leave has been repeatedly refused and you think your rights have been breached, reach out now. Redmans Solicitors are sector specialists who can answer your queries and assess your eligibility to make a claim.

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