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4. Holidays ( Part 4)

How many holidays should workers get? ( Article 9)

• The holiday year will cover the period 1 January to 31 December 2007.
• The holiday entitlement set out in Part 4 of the Order complies with the provisions of the Working Time Regulations ( WTR).
• A worker is entitled to 5 weeks holiday per year. A week is equivalent to the number of days that an employee would be expected to work in the course of a regular working week. In addition, 4 special holidays are set. Details of these dates can be found on page 6 (article 10).

Example: If a worker normally works for 3 days a week, he would have to use 3 days of his holiday entitlement in order to take a week's holiday. His annual entitlement could be said to be 15 days.

• Where the number of days worked varies from week to week, the average number of days worked per week over a 12 week period should be calculated.
• When a worker begins working with an employer during the holiday year, his entitlement will be in relation to the part of the holiday year still remaining, plus any of the special holidays which fall within the same period.
• During the first year of employment, the number of days holiday that a worker has a right to take at any time is limited to the amount he has accrued at that time.
• Accrual is at the rate of one-twelfth of the annual entitlement at the beginning of each month.

Example: A worker who is in his fifth month of employment and works a 5 day week would have built up 10 ¹/ ² days holiday (the annual entitlement of 25 days multiplied by ⁵/ ¹² equals 10.42 days rounded up to 10 ¹/ ² days).

• The WTR make it clear that a worker is entitled to a minimum of 4 weeks holiday in a holiday year. There is no provision for payment in lieu of any part of these 4 weeks if they are untaken by the end of the holiday year. Payment in lieu will, however, still apply to those holidays which are over and above the provisions set by the WTR.

Example 1: A worker, who normally works 5 days per week, has, at the end of the holiday year, used only 13 days of his holiday entitlement. In addition to this, he has had all of his Special holidays. The balance of untaken holidays is 12 days. Seven of these days fall within the entitlement set by WTR, and as such, they attract no payment in lieu. The remaining five days, being over and above the WTR entitlement, would attract payment in lieu.

Example 2: A worker, who normally works 5 days per week, leaves his place of employment on 1 September. As he has worked for three-quarters of the year, he would have been entitled to three-quarters of his holiday entitlement: three-quarters of 25 days = 18.75 days, rounded up to 19 days. He has used only 10 of these days, and has also had all of the Special holidays he has been due. The worker would be entitled to receive payment in lieu for all 9 days.

• If a worker's employment is terminated, then he will be entitled to payment in lieu for all holidays to which he is due, calculated up until the date of the termination of employment.

What about special holidays? ( Article 10)

• In 2007, each worker will be entitled to 4 special holidays as follows:
  • Christmas Day;
  • New Year's Day;
  • the first Monday in May;
  • the first Monday in October;
• If any of these days fall on a day of the week on which the worker would not normally be required to work, then the next normal working day will be allowed as a holiday.

Is time allowed off for bereavements? ( Article 11)

• In the event of the death of a worker's child, parent, spouse, or someone they live with with as if they are married to them (see article 11(2) of the Order for a full definition), the worker is entitled to at least 3 days paid bereavement leave.

What payments are made for holidays taken by a worker? ( Article 12)

• A worker is to be paid for his leave according to sections 221-224 of the Employment Rights Act 1996, which determine the amount of a week's pay for the purposes of that Act. A normal week's pay is therefore:
  • for a worker with regular working hours, what he would earn for a normal working week;
  • for a worker whose normal working hours vary from week to week, the average hourly rate of pay he gets multiplied by the average of his normal weekly working hours over the previous 12 weeks;
  • for a worker with no normal working hours, the average pay received over the previous 12 weeks.
• A worker's normal working hours are said to be the normal hours fixed by his contract of employment. Overtime hours are not normal working hours unless a worker's contract fixes a minimum number of hours (in which overtime is included) which is more than his notional fixed hours.

Example: A worker, with more than 26 weeks continuous employment, who receives the minimum rate of pay, works a week of 39 hours followed by a week of 47 hours. As these hours can be seen to vary from week to week, the average hourly rate of pay would be multiplied by the average of their normal weekly working hours over the previous 12 weeks.

The average hourly rate of pay would be worked out as follows:

(39 hours x 2 weeks x £5.70) + (8 hours x £8.55) ÷ 86 hours = (£444.60 + £68.40) ÷ 86 hours
= £513.00 ÷ 86 hours
= £5.97 per hour

The average hours worked over the previous 12 weeks would be worked out as follows:

(39 hours x 6 weeks) + (47 hours x 6 weeks) ÷ 12 weeks
= (234 hours + 282 hours) ÷ 12 weeks
= 43 hours

A week's holiday pay would therefore be 43 hours x £5.97
= £256.71

What happens if a worker has to turn out on a holiday? ( Articles 9(10) and 13)

• If a worker has to work for any part of a day on which it had been agreed that he would be on holiday (excluding special holidays) the following rules will apply:
  • the day will not be regarded as a holiday taken ie the worker's holiday entitlement will not be reduced in any way;
  • each hour actually worked will be paid at not less than the minimum hourly rate (excluding the additional sum) to which the worker is entitled multiplied by 1.5. A minimum of 4 hours must be paid even if the time worked is less than 4 hours. When more than 4 hours are worked, payment must be made for the actual number of hours worked.
• Different arrangements apply when a worker has to turn out on any of the 4 special holidays as shown below.
• Firstly, if a worker agrees to work on 25 December or 1 January, the following rules will apply:
  • for each hour worked, the worker must be paid not less than 3 times his minimum hourly rate (including the additional sum if appropriate). In these circumstances there is no requirement to pay for a minimum of 4 hours - payment need only be made for the actual hours worked;
  • also, if Christmas Day or New Year's Day falls on a day on which the worker would normally work, then the day will count as a holiday taken.
• Secondly, if a worker agrees to work on the first Monday in May or October, the following rules will apply:
  • one day will be added to the worker's holiday entitlement;
  • the hours worked will be paid at not less than the minimum hourly rate to which the worker is entitled, including the additional sum, if appropriate, with the overtime being paid for any hours worked in excess of 8 on the day or 39 in that week.
  ( Note: These rules will apply when a worker who would not normally have worked on one of the 4 special holidays is required to work on the holiday in lieu to which he is entitled, ie his next normal working day.)

What happens when the full holiday entitlement is not taken? ( Article 14)

• Where a worker has not taken all of the days holiday to which he is entitled by the end of the holiday year, that worker will be due payment in lieu for only those days which are over and above the entitlement set by the WTR (4 weeks).
• Where a worker has not taken all of the days holiday to which he is entitled on the termination of his employment, that worker will be due payment in lieu for any days not taken, including all or part of the WTR entitlement.
• Payments in respect of holidays not taken (subject to the above) should be made no later than the first regular pay day after 31 December or within 7 days of the end of employment.

Who decides when holidays can be taken? ( Article 9(8))

• Normally a worker and employer will be able to agree suitable holiday dates between them.
• Where no such agreement can be reached, the employer may give the worker 21 days notice of the date(s) when the holiday can be taken. The employer will allow the holiday to be taken before the end of the holiday year, or before the worker leaves his employment.

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