5 potential problems with holiday rollover
1. Not putting a limit in place
Firstly, you can’t simply let everyone carry over whatever untaken holiday they have left. As a minimum, UK workers are legally entitled to 5.6 weeks holiday per year (28 days including bank holidays). But by law, four weeks of that must be taken within the holiday year it occurs; it’s only the remaining eight days that can be used for rollover. If you offer employees more than the statutory 28 days, you can choose to let them rollover those additional days too.
So for starters, your holiday rollover policy must state the maximum number of days that can be bumped into the next year to avoid employees making requests that can potentially get you in legal hot water. And don’t forget, some staff may be on different contracts so the same entitlement may not apply to all.
Read more: An expert guide to holiday entitlement.
2. Getting the holiday year wrong
When does your holiday year start and finish? Lots of companies choose to run from 1st January to 31st December, but you don’t have to. You could opt to match the financial year for example. It’s up to you when, you just need to make sure that all staff are clear on when the holiday year runs.
Where problems can arise is when you decide to set a cut-off point for using the holiday rollover days. You can allow staff the whole year to use the extra days if you wish, however lots of companies limit the rollover period, typically for three months, sometimes four or six. Bear in mind when you decide on your holiday year end and rollover cut-off points that you always avoid having lots of staff making requests for time off during a busy period in your yearly cycle.
3. Staff issues about who takes time off when
Introducing holiday rollover is a good time to clarify your policy regarding how holiday is booked and approved and soften the impact of the end of year ‘bottleneck’. No employer is allowed to prevent staff from taking their statutory holiday entitlement, but you can take reasonable steps to ensure that the business doesn’t suffer because everyone is off at once. The excitement of rolling over unused days might result in a flurry of holiday requests near the cut-off point so make sure your rules are clear about how and when holiday requests are made and what cover should be in place whilst colleagues are off.
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4. Keeping track
Introducing holiday rollover can get complicated if you don’t have a suitable staff holiday booking system in place to keep track. It’s hard enough keeping records of who has booked what, half days, time in lieu, different contractual entitlements etc. There are legal rules to stick to about holiday entitlements as well as any additional contractual constraints employees may have in place for additional days. HR needs to keep on top of all of this to ensure compliance as well as good old-fashioned fairness – so make sure your back-office systems and staff are geared up to cope.
5. What happens when someone leaves?
Make sure your holiday policy makes clear exactly what happens if someone leaves your employment whilst they still have holiday left. There are obviously legal rules in place about statutory holiday and what happens to that – but once you’ve decided on your rollover policy you need to ensure the position regarding leavers is also clear – otherwise they are likely to assume they will be paid for all unused days. Take legal advice on this up front if you’re not sure.
One last word
We all need and enjoy time away from work in order to recharge our batteries and feel refreshed. Use your new holiday carry over guide to get up to speed on the basics, and don't forget to remind all your staff to make good use of their holiday entitlement. It’s a proven way to get the best from them in terms of productivity as well as helping to ensure a happy and healthy workforce.