One of my team has stated that we aren’t following the law with how we deal with Bank Holidays, so could you clarify what we have to do when it is a Bank Holiday please? 

Time and time again, bank holidays are a source of confusion for our clients and understandably so, as much of the legislation around Bank Holidays isn’t clear, and it can lead to upset and complaints. Here’s what employers should know about bank holidays.

1.1 There is no right to automatic time off

There is no statutory right to time off on a bank holiday. All workers must receive at least 5.6 weeks’ paid annual leave each year, but it is up to you as an employer as to when your staff are allowed to take those days off.

Many businesses close on bank holidays and, where that’s the case, it is relatively easy to deal with; it can be specified in the employment contract which bank holidays must be taken as annual leave. There are various ways to do this, such as specifying the days (ie Good Friday, early May bank holiday, etc) to be taken as bank holidays or saying that the bank holidays are part of the employee’s overall holiday entitlement, amongst others.

Where the business isn’t closed, then it may be that only some of the staff have to work. Setting out a rota in advance of these bank holidays, with who is expected to work or asking employees to volunteer to work on bank holidays, eg perhaps by requiring them to do a minimum of two a year, are good ways to manage this to avoid any confusion. Where bank holidays form part of an employee’s holiday entitlement and they do work, they should be allowed to take the leave at another time, or their annual leave will be short for the year.

1.2 Employers can set their own rules on pay for bank holiday working

Employers may reward staff for working on bank holidays by paying them extra, but there is no rule that this must happen; it will be down to the employment contract again. Many businesses offer extra pay for bank holidays as an incentive to encourage staff to work.

Any bonuses, including extra pay for bank holidays, should be clearly stated in staff contracts. Where extra pay has been paid in the past, but it is not set out in the contract, it may be that an implied term has developed that it will be given. Withdrawing additional pay on bank holidays in these circumstances may therefore be a breach of contract and result in an employment tribunal claim. It is important to be consistent in applying these rules and the best way to ensure this is to put it in writing in the employment contract.

1.3. Employees can be forced to take annual leave over bank holidays

If an organisation closes over bank holidays, such as on Christmas Day, employees can be required to use annual leave while the organisation is shut. Where there are plans to do this, as much notice as possible should be given, usually at the beginning of the annual leave year. The minimum notice that must be given is twice as much notice as the period that the employee is required to be off work. For example, to require employees to take one week off, they would need to be given two weeks’ notice to do so.

One of the most straightforward ways to do this, is again, to include it in the employment contract and/or holiday policy.

1.4. Holiday requests from particular groups of employees should not be prioritised

Questions often arise as to whether annual leave requests from staff with religious beliefs or those who have school-age children should be prioritised where they coincide with school holidays or special religious occasions, but this could result in issues with childless workers or non-religious workers. Instead, it is advisable to adopt a first-come, first-served approach. Some organisations will set rules around when leave for certain times of the year will be accepted, so everyone has a fair shot at getting their request in.

Where individual teams have minimum staffing requirements over bank holidays, or at any time in the year, it is strongly recommended to highlight these to staff and to let them know how many people are already booked off so they can make their plans accordingly. This could be via a shared holiday calendar, or an anonymised calendar marked with how many people are off on individual days.

1.5. Annual leave policies and employment contracts

It’s a requirement under the Employment Rights Act 1996 to set out employee entitlement to holidays, including public holidays, and holiday pay in the employment contract. Beyond this legal minimum, its important that you communicate clearly to staff what the rules are on holidays, so your contracts and holiday policies should cover:

• extra pay for working certain days
• annual leave requests and notice requirements for requesting
• days staff need to reserve holiday for (such as bank holidays or annual shutdowns over the summer or at Christmas for example)
• restrictions on annual leave and policies on carrying over leave.

Key Takeaway about bank holidays

With eight bank holidays in England, nine in Scotland and 10 in Northern Ireland in a standard year, it’s a good idea to set down rules on bank holiday working so that a consistent approach can be taken to them every time another comes around. Failing to do this can cause confusion and lead to the same questions being asked and answered, again and again.

If you need help updating your contract or holiday policy to ensure you have your rules clearly stated and legally compliant, then get in touch and we can help you get Bank Holidays right!