Annual leave law update

Well it is that time of the year again, holiday season. As usual, employment law and regulations keep changing and it seems that this space is becoming more and more confusing rather than simpler. All you have to do is take one look at the legislation on shared parental leave to know what we’re talking about. There are many regulation changes that are currently being discussed in the UK and two of the annual leave law updates seem particularly relevant because they are likely to affect most employers.

The first is David Cameron’s election pledge to change the working time regulations to allow employees a further 3 days paid leave for the purposes of volunteering. BBC’s correspondent Christian Fraser estimates this will cost the economy £24bn a year. Further to this there many other issues about how to apply the rules. For instance if a company already gives higher than minimum paid holiday allowance (at least three days more) would they still be required to give a further 3 days? The biggest problem with regulation changes is the lack of certainty which generally requires at least one company to be sued before the courts clarify it for us.

The other major change relates to the European Court of Justice ruling that commission and overtime must be included in holiday pay (Lock v British Gas and Bear Scotland). This is problematic as calculating what commission an employee would have earned and how many hours of overtime they’d have accumulated some say is nothing more than an exercise in fortune telling. What you may not know is that this ruling is currently being appealed and may be overturned, depending on what the outcome is. Implementing a new company policy to follow the court rulings is therefore problematic, as we don’t even know if a policy change is needed at all yet.

For now all we can say is: “enjoy your summer holidays and good luck!” Watch this space for further annual leave law updates.

To easily track how much holiday your employees have taken, take a look at Engage holiday management tools. Our online holiday requests and automated trackers reduce the admin burden around annual leave.