Written by Nikki Whitaker
Published on May 22, 2020
Can furloughed employees be forced to take Annual Leave?

Due to the ongoing situation with Coronavirus in the UK many employers are left feeling confused about what they can, can’t and should do during this difficult time. Over recent weeks the Government has been releasing updates hard and fast, which has left many people struggling to keep up with the latest advice.

Arguably the most frequent questions we currently receive surround furlough and annual leave. Can employees still take it? Is it paid at the usual rate? Can employees be forced to take it if there is an organisational requirement? In this post today we will answer these questions and more.

Under normal circumstances

Employers can make their employees take days off as long as you give the employee appropriate notice. If you as an employer want your employee to take holiday on certain dates, you need to tell the employee at least twice as many days before the number of days you wish them to take.

For example, if you want the employee to take 5 days annual leave then you need to inform the employee 10 days before the holiday starts.

In my opinion it is better to give the employee as much notice as possible and communicate with them in order to give them the opportunity to make plans and ensure enforced leave goes as smoothly as possible.

Furlough and Annual Leave

Employees continue to accrue annual leave whilst on Furlough and can take annual leave during a period of Furlough. Working Time Regulations say that holidays must be paid at the employee’s normal rate of pay.

Employers can still claim 80%/£2500 per the Coronavirus Job Retention Scheme (CJRS) and will in effect be topping up the holiday pay to 100%.

You can make employees take annual leave whilst on Furlough as long as you give appropriate notice as described above.

Staff cancelling annual leave.

It’s normally the businesses decision if they allow their employees to cancel pre booked annual leave, as in normal circumstances cover may have been booked/arranged to cover this period of leave. With the current Covid-19 pandemic employers would be wise to tread carefully. Employees will be worried about travel and indeed may well be having their holidays cancelled as the holiday industry follows Government advice.

Allowing your staff to cancel their pre-booked annual leave will help towards good workplace relations, and it’s advisable to keep open communication channels with staff and ask them why they want to cancel their leave. It may be that employees simply wish to move their leave to later in the year if their holiday has been postponed.

Records should be kept of staff’s annual leave, and it may be that as you progress through your businesses leave year you need to start thinking about enforcing periods of annual leave.

Be aware of the possibility that when the Covid-19 situation changes, a large amount of your workforce may well apply for annual leave for the end of the year, for the same period, which is something most employers will be unable to accommodate.  It is advisable to inform your employee when you agree to cancel their pre booked leave that, future requests will only be granted if the needs of the business can allow it.

Health and Safety wise, remember that staff need holidays in order to refresh and recharge their batteries and employers should ensure that staff get these breaks wherever possible. Employees who take their leave are normally more motivated and perform their role better.

Carrying over annual leave

This has always been possible if your contracts of employment allow for it, however, on 27th March 2020 the government announced that workers who had not been able to take their annual leave allowance can carry over their statutory leave (5.6 weeks) into the next two years.

4 weeks can be carried over for up to 2 years and 1.6 weeks can also be carried over, by agreement, for 1 year only. You cannot replace the holiday with payment in lieu unless the worker is leaving employment.

Bear in mind that any accrued leave which has been carried over must be paid to the employee as a lump sum if they are made redundant.

For information on the CJRS visit our recent post ‘Coronavirus Job Retention Scheme – What we know so far and our most recent update ‘Updated Furlough & Coronavirus Job Retention Scheme Guidance from HMRC.

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