Coronavirus: employees permitted to carry over unused leave in changes to Working Time Regulations

In the latest of its legislative measures in response to the Coronavirus pandemic, the UK Government has announced proposed changes to the rules on annual leave within the Working Time Regulations (WTR).

Workers and employees are entitled to 5.6 weeks’ annual leave entitlement per year under the WTR. For a full time employee working 5 days per week, this amounts to 28 days per year. Of this, 4 weeks (20 days) is the entitlement under the European Working Time Directive (Basic Entitlement); the remaining 1.6 weeks (8 days) is additional leave granted under the WTR (Additional Entitlement).

Presently, there is no entitlement to carry leave over from one leave year to the next, save in certain exceptional circumstances such as when the worker is on maternity leave or long term sick leave. Further, there is an obligation on employers to ensure workers have an adequate opportunity to take statutory holiday entitlement during the relevant leave year.

What are the changes for carrying over unused holidays?

The UK Government has announced The Working Time (Coronavirus) (Amendment) Regulations 2020. This amends the WTR to create a further exemption relating specifically to COVID-19. Where it is not reasonably practicable for a worker to take some, or all, of the holiday to which they are entitled due to the Coronavirus, they have a right to carry the Basic Entitlement forward into the next two leave years. This right does not extend to the Additional Entitlement, although this could be agreed separately between the employer and workers.

There are also proposed amendments to the WTR to ensure such carried over leave is eligible for payment in lieu when employment terminates, and limitations on employers preventing this carried over leave being taken – requiring an (undefined) “good reason” in order to do so.

Although the announcement focused on the benefit of this to key sectors providing support to the country’s response to COVID-19, in that it will allow businesses and employees to continue to provide such services without disruption because of annual leave and without loss of annual leave entitlement, this move will increase flexibility for businesses generally when dealing with Coronavirus and its aftermath. This is because the amendment provides that this exemption will apply when it is not reasonably practicable for a worker take leave due to the COVID-19 effects on the worker, the employer or the wider economy or society.

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