Whether your idea of an ideal holiday is an all-inclusive break to the Maldives, scaling Mount Everest or a wet weekend camping in Snowdonia, I think we can all agree that sometimes we just need a break. For practice owners, holidays are where you can shut off and recharge ready for the next challenge. They are essential in helping to improve your mental health and can help you to gain a fresh perspective on your business. And it’s the same for employees, they need a break too. A rested and refreshed employee can be happier, healthier, and more motivated, all leading to improved job performance.

The difference between you as a business owner and an employee is that you can choose how much holiday you take. With employees, they are guaranteed a certain number of days off each year and that right to time off is protected by law. Here we look at some of the frequently asked questions when it comes to annual leave.

What is the statutory annual leave entitlement?
Full-time workers are entitled to 28 days of paid annual leave per year (the equivalent of 5.6 weeks). It’s sometimes thought of as 20 days plus bank holidays but that can be deceiving, especially for part-time workers or when additional bank holidays are declared.

Can I give employees more than the statutory annual leave entitlement?
Yes! Sometimes this can be a good selling point when trying to entice new employees to your practice. An employee’s annual leave allowance should be set out in their contract of employment, and you should also bear in mind the points raised below regarding proportionally reducing the allowance for starters, leavers, or part-time workers.

What is the statutory annual leave entitlement for part-time workers?
The gov.uk website has a useful tool that can calculate statutory entitlement based on the number of days or hours worked per week. But to summarise, a worker’s entitlement decreases proportionally in comparison to that of a full-time worker:

• Full-time (5 days) (5 × 5.6) = 28.0 days;
• 4-days per week (4 × 5.6) = 22.4 days;
• 3-days per week (3 × 5.6) = 16.8 days;
• 2-days per week (2 × 5.6) = 11.2 days;
• 1-days per week (1 × 5.6) = 5.6 days.

The entitlement can also be calculated in hours with number of hours worked multiplied by 5.6 (i.e. 40 hours per week = 40 × 5.6 = 224 hours of annual leave entitlement).

What if an employee starts part way through the holiday year?
Here the annual leave entitlement is proportionally reduced according to the number of months remaining in the year. For example, you have a holiday year that runs from January to December, and you have a new full-time employee starting in May. Their statutory leave entitlement will be 19.0 days (28 days × 8/12 months – rounded up to the nearest half or whole day).

What if an employee leaves part way through the holiday year?
Here the annual leave entitlement is proportionally reduced according to the number of days remaining in the year. For example, you have a full-time employee leaving on 22 September. Their statutory leave entitlement will be 20.4 days (28 days × 265/365 days – rounded up to one decimal place). This entitlement should then be compared to the number of holiday days taken by the employee (including bank holidays) to give an adjustment for their final payslip – either an amount of accrued holiday pay due or a deduction for holiday taken in excess of allowance.

What if an employee starts and leaves in the same holiday year?
In this event, the annual leave entitlement is based on the number of days the employee has worked for the practice. For example, a full-time employee starting on 17 May and leaving on 22 September would be entitled to 9.9 days (28 days × 128/365 days – rounded up to one decimal place). Again, this should be compared to annual leave taken by the employee to give either an amount of accrued holiday pay due or a deduction for holiday taken in excess of allowance.

I have a casual worker that has no fixed hours, do they still have a holiday entitlement?
Yes, and it’s the same as for all other workers, 5.6 weeks of annual leave per year. The problem we have is calculating what 1 week looks like for someone who has no fixed hours. Legislation now states that 1 week is the average hours worked over the previous 52 weeks (only counting weeks in which they were paid). Further details on this subject can be found in a previous blog.

Are there software programmes that can help me keep track of staff holidays?
Yes! There are hundreds on the market and a quick Google search will generate lots of options. Our clients have previously had success using Breathe HR and even our own Brightpay Connect has a basic holiday booking system.

Calculating staff holidays can be a complex area and it’s important to get it right to maintain a happy and productive workforce. If you’d like further information regarding our payroll services, please get in touch.