We have got the latest government guidelines regarding Furlough and holiday payments…
Workers on furlough continue to accrue statutory holiday entitlement, as per their contract.
The Job Retention Scheme does not change whether agency workers accrue holidays between contracts – if their contractual agreement states that they do accrue holiday then they will continue to do so, however their is no new entitlement that allows agency workers to accrue holiday whilst on Furlough if their contract does not state so.
Required Holidays and Bank Holidays
If employees has annual leave that is pre-booked, employers can require that they take this during furlough. However it is key at all stages to engage with employees and discuss why it is a requirement. E.g. financially the business cannot issue all holidays once the Furlough scheme comes to an end.
With regards to bank holidays, it can be down to the discretion of the employer and a discussion with the employee. Employers can decide not to reduce holiday balances by bank holiday days, or they can require employees to account for bank holidays as usual.
In any case (annual leave or bank holidays) where employees holiday balance would be reduced whilst they are on furlough, their furlough payment must be uplifted to 100%.
Carry Over Holiday
A temporary new law has been introduced that allows employees to carry over 4 weeks of unused holiday (due to coronavirus) over into the next 2 years. Employers should be encouraging workers to use their holiday entitlement as usual, however if employees cannot reasonably do so, this law can be utilised.