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Employer's guide to coronavirus, holidays and annual leave
02 Apr 2020
For many of us, a holiday now seems a long way off. Plans have been delayed, flights and hotels cancelled as coronavirus affects almost every part of daily life.

But what affect will it have on businesses and employees? Tracy Worthington, a Partner in our Employment Team, takes a look at some of your questions on annual leave.

What are the usual rules around taking annual leave?

Almost all employees are entitled to 28 days holiday each year including bank holidays, however most of it has to be taken within a 12 month period, which means some workers could lose it if they don’t use it.

What’s changed because of Covid-19?

The Government has amended regulations to allow annual leave to be carried over the next two years. It means employees who can’t take their holiday entitlement won’t lose it and gives flexibility to employers who may need staff to continue to work, particularly key workers.

As an employer, I thought I could be fined if I didn’t let staff have their full holiday entitlement?

The Government has confirmed there will be no financial penalty for businesses as long as they allow up to four weeks unused leave to be carried into the next two leave periods.

Can I pay staff in lieu of taking holiday?

No, the leave period can’t be replaced with a payment unless the employee is leaving your employment.

Does this change in regulations apply to all employees?

It does, but it is expected that most employees will still take holiday within the 12 month period because it’s important staff can rest and recharge. However key workers may not be able to take this leave as they are part of the national effort in the fight against coronavirus. It is expected that these rules will mostly apply to these key workers.

I’ve furloughed some of my staff, does their annual leave entitlement continue?

Yes, employees continue to accrue statutory holiday leave during the furlough period. If employment contracts provide more than the minimum holiday of 5.6 weeks per year, then employers can ask employees to agree this will not accrue if they wish.