Annual Leave – Furlough & Beyond

By Louise McAloon, Partner, Worthingtons Solicitors.

With over 200,00 employees placed on ‘furlough’ in Northern Ireland as a result of COVID-19 disruption and the availability of the Government’s CJRS furlough scheme over a 7 month period from the end of March until the end of October, managing an orderly usage of annual leave presents a unique challenge for employers this year. Government guidance has helpfully confirmed the following:

  • Workers on furlough can take holiday without disrupting their furlough
  • Employers should do everything reasonably practicable to ensure that the worker is able to take as much of their leave as possible in the year to which it relates
  • Workers who are on furlough are unlikely to need to carry forward statutory annual leave, as they will be able to take it during the furlough period

Employers can require workers to take holiday at a particular time or potentially cancel a worker’s holiday if they give enough notice to the worker. The required notice periods in relation to a worker’s leave entitlement under the Working Time Regulations are as follows:

  • Double the length of the holiday if the employer wishes to require a worker to take holiday on particular days
  • The length of the planned holiday if the employer wishes to cancel a worker’s holiday or require the worker not to take holiday on particular dates

Employers can ask workers to take or cancel holiday with less notice but need the workers’ agreement to do so. Notice Requirements in relation to any additional contractual leave entitlement beyond the 5.6 weeks under the Working Time Regulations will depend on individual terms and conditions & policies.

The Working Time (Coronavirus) (Amendment) Regulations (Northern Ireland) 2020 were brought into effect on 26th April 2020. The Regulations provide that where in any leave year it was not reasonably practicable for a worker to take some or all of their 4 week leave entitlement (under the Working Time Directive) as a result of the effects of coronavirus (including on the worker, the employer or the wider economy or society), the worker shall be entitled to carry forward such leave and take it in the two leave years immediately following the leave year in respect of which it was due.

Best practice is to allow a worker to take holiday from the leave entitlement that expires first ie workers should be allowed to take the holiday to which they are entitled in the new leave year before they take the ‘carried’ holiday under the Regulations, as the ‘carried holiday’ entitlement lasts for 2 years. However, ‘carried holiday’ is subject to further protections. The employer must have good reason to refuse to allow a worker to take “carried holiday” on particular dates. An employer may request that a worker takes “carried holiday” instead of their regular entitlement. If they do so, the employer must still ensure that the worker receives their full regular entitlement in the leave year to which it relates, in addition to any carried holiday taken. Where carried leave is carried into a further leave year, the employer must facilitate the worker taking their leave in that later year.

In Northern Ireland, the carry over provisions must be interpreted and applied in line with the ruling of the Northern Ireland Court of Appeal in Chief Constable of the PSNI and another v Agnew and others [2019] NICA 32 which confirmed the finding of the Industrial Tribunal at first instance that a worker’s 4 week leave entitlement under the Working Time Directive is not used up first in a leave year and forms part of a “composite whole”. This is a deviation from the position in GB where the EAT in  Bear Scotland Ltd v Fulton and another UKEATS/0047/13 ruled that it is for employers to choose which type of leave is taken when (ie Directive leave first, then the additional leave entitlement under the Working Time Regulation and then any additional contractual leave entitlement). A worked example of how to calculate a worker’s carry over entitlement in both jurisdictions are provided in the slides available.

Good practice recognises the need to balance the importance of allowing workers to have flexibility in relation to when they might wish to take their annual leave at a time that suits them and their families against the need to avoid a build-up of leave necessitating carry over. Active management and workforce planning is required if employers wish to avoid unnecessary or unintended levels of carryover into next year and the year after. Engagement and consultation with individual staff is key to planning an appropriate and proportionate usage through the leave year. Employers should identify any potential busy periods when leave should not be taken and provide advance notification to staff at the earliest opportunity. If work levels and operational requirements are such that an employer is satisfied that staff should be able to avail of their full leave entitlement this year and carry over is not required, it is critical that the employer sets out that expectation in written communication to staff, that individual usage is kept under regular review and that reminders are issued where appropriate to ensure that workers are aware that they need to book and take their time off.

Louise McAloon is a Partner in Worthingtons Solicitors specialising in employment law. Her email address is louise@worthingtonslaw.co.uk.

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