This week the experts, Adam Partington and Esther Smith, advise on accrued bank holidays during maternity leave.
The question: Bank holiday confusion
We currently offer 22 days holiday per year plus bank holidays (for full timers) and our holiday year runs from 1st July – 30th June.
I have a lady whose baby is due in early Jan, she wishes to save her holiday entitlement and take it prior to maternity leave commencing, which is fine. We have included the Christmas and New Year BH into this so effectively she will be taking her 22 days holiday plus the 3 days BH. However she would normally be entitled to another 4 BH after this, Easter and may bank holidays but will "miss" these being on maternity leave do I tag those on to her holiday leave otherwise she will lose them?
In terms of accrual for the following year do I include bank holidays?
Adam Partington, solicitor, Speechly Bircham
Your first question is whether the employee would be entitled to the four further bank holidays. It seems to me that she will definitely be entitled to three out of four. This is because the employee’s statutory paid annual leave under the Working Time Regulations (WTR) will continue to accrue during maternity leave. This entitlement is currently 28 days, although this can include bank holidays. This means you must allow her to take 28 days in total.
Contractual holiday over and above the statutory entitlement under the WTR will also accrue during maternity leave. Whether or not this includes bank holidays depends on how the contract is drafted. You may therefore not have to pay anything over the 28 days statutory entitlement (in this case the bank holidays) but you would need to take specific legal advice to resolve this point if you do not want to pay this.
The same principles apply to the accrual of bank holidays in the following year whilst the employee is on maternity leave.
In relation to when you allow the employee to take the holiday leave (including bank holidays), you can simply add these days on to her entitlement so that she is given the correct number of days for the year before she goes on maternity leave. It is also possible to agree that the employee will be entitled to take some of her leave at the end of her maternity leave or on her return to work (it does not all have to be front loaded). If you give them to her upfront you may end up giving her too much paid holiday if she resigns or is dismissed before the end of the holiday year (for example, as a result of a redundancy exercise during maternity leave). You may be able to recover this but this will depend on the circumstances.
The position on accrual and carry over of holiday is quite complicated and therefore if you are in doubt as to what you can and cannot do as an employer, you should take advice.
Esther Smith, partner, Thomas Eggar
Unless you have a contractual maternity policy which provides for something different, the general approach is not to include bank holidays when calculating accrued leave for people on maternity leave.
However an employee is entitled to their minimum holiday entitlement under the Working Time Regulations 1998 during both OML and AML, which is now 5.6 weeks. It appears this lady works full time (5 days a week) so her 22 days’ holiday reflects less than her 5.6 weeks, and therefore you would need to include enough of the bank holidays to get to this level of accrual, during her leave, so that you are not in breach of the 1998 regulations. Given that the 8 bank holidays brings her entitlement up to 6 weeks, rather than the minimum 5.6, it might be easier (administratively) to treat them as accruing.
Esther Smith is a partner in Thomas Eggar’s Employment Law Unit. For further information, please visit Thomas Eggar.