Whilst most employers run the usual January to December holiday year, some companies operate a holiday year which mirrors their financial year. Those very brave employers have a holiday year which follows each employee’s employment start date (administratively this must be a nightmare!)
Employers with an April to March holiday year will find themselves in a peculiar situation for 2016 through to 2018. Remember that all workers are entitled to a minimum of 5.6 weeks’ paid holiday, which means 28 days for a full-timer. Bank holidays count towards this entitlement.
Due to the moving Easter holidays, rather than the typical eight bank holidays in a year, April 2016 – March 2017 will have only six bank holidays, while April 2017 – March 2018 will have ten.
So what can you do about this?
Your first port of call is to check your contractual wording around holiday entitlement. This could throw up a number of different scenarios.
Here are a few (using full-time workers as an example):
However, for April 2017 – March 2018 you could choose not to give employees two of the ten bank holidays (there is no automatic right to time off on a bank holiday). However, unless they agree otherwise, you would not be able to deduct these from the 20 day holiday entitlement as the contract says that they are entitled to 20 days holiday. You would instead have to get them to work two bank holidays, which may not be practical if the office is closed and certainly will not be popular.
This situation is bound to arise again in the future so the next time you undertake a review of your employment contracts it would be worth considering whether you want to include wording in the holiday clause so that holiday entitlement can be adjusted each year if necessary to allow for this scenario.
This may be even more desirable where you already offer holiday in excess of the minimum statutory entitlement and don’t want to be in a position of having to afford additional days to employees in a particular year.