The Government have today, 14th May, provided guidance on the management of annual leave whilst employees and workers are on furlough. The published guidance is easily digestible but headlines you will want to note are:

  • Annual leave taken during furlough should be paid at 100% of salary or, if your employee has a variable wage, the average over the preceding 52 weeks.  Please note that the 52 week average is a new piece of legislation from April 2020.
  • Yes, you can insist an employee takes annual leave during furlough unless they are in the highly vulnerable group or are isolating because they or a member of their household has Covid 19.  Given that no one can go anywhere you might want to consider the reasonableness of requiring your staff to take annual leave during the current lockdown.  If you want to maintain employee engagement, then being fair and reasonable are key components of managing a motivated and engaged workforce.
  • If Bank Holidays are normally worked then there is no change to furlough.  But if you include Bank Holidays in your employees/workers holiday entitlement you should either pay those days at 100% or defer the days and include them in their accrued holiday entitlement.   As a reminder, there have been three Bank Holiday days since the inception of the furlough arrangements and another to come at the end of the month.
  • The emergency legislation, snappily entitled The Working Time (Coronavirus)(Amendment) Regulations 2020, published at the end of March allows employees to carry holiday forward where the impact of coronavirus means that it has not been reasonably practicable to take it in the leave year to which it relates.  So, annual leave can be carried forward for two years if employees have been unable to take that leave.  Employers should consider facilitating the taking of annual leave once the workplace returns to something close to normality otherwise there is a danger that employees will have six or eight weeks annual leave waiting to be taken and across the piece, that might prove difficult to manage.
  • If you are in the disappointing position of having to make staff redundant, please don’t forget to add any deferred annual leave days from lost Bank Holidays to payment for accrued but untaken annual leave.  We don’t want any Employment Tribunal claims for unfair deduction of wages!

As always, I can be contacted on 07766 167160 or through if you have any questions.  I am currently providing Covid 19 advice pro bono to Chamber members.