Does your Holiday Year run from April to March? You might have a problem

12 August 2016

Does your Holiday Year run from April to March? You might have a problem.

If your organisations runs a holiday year from April to March, depending on how your holiday entitlement is worded in the employment contracts, this might mean that some employees will face a shortfall in their holidays. Below we explain how this happens and what you should do about it.

The statutory minimum entitlement to holidays in the UK is 5.6 weeks, which, for a full time employee translates to 28 days per year. Most employment contracts say that an employee is entitled to 20 days holidays and any Bank Holidays.

Normally, every year will have 8 Bank Holidays but because Good Friday and Easter Monday don’t always fall on a fixed date, it is possible for these two days to fall in either holiday year, when the holiday year starts in April. This is exactly what just happened.

In 2015 Easter was celebrated right at the beginning of April, therefore falling into the 2015-2016 holiday year. In 2016 the Easter break occurred at the end of March, again falling into the 2015-2016 holiday year. As employees, if so worded in the contract, are entitled to all Bank Holidays they have enjoyed 10 days instead of the usual 8 days off.

A problem then arises in the 2016-2017 holiday year. We have already seen that the 2016 Easter break fell in the previous holiday year, and it just so happens that the 2017 Easter break will be part of the 2017-2018 holiday year because Easter will be celebrated in April 2017. This means that employees will only get six Bank Holidays in the 2016-2017 holiday year. The total entitlement will therefore be only 26 days which is under the statutory minimum.

What should you do?

If you have found yourself in this situation you will most likely have to grant your employees two additional days of holidays but this will depend on the exact wording included in your contracts so the first step will be to get your contracts reviewed by a specialist.

You cannot simply rely on two additional days in the previous holiday year to “balance out” the shortfall in this holiday year.

Easter tends to fall either in March or in April so this is definitely not the last time this problem will arise. You might want to explore whether changing the wording in the contracts would help avoid this problem going forward.

Please don’t hesitate to contact HR Solutions team if you have further questions on this topic.