On 1 October 2007, the Statutory Holiday Entitlement is changing from 4 weeks to 4.8 weeks, which equates to 24 days if an employee is working a 5-day week.

Currently, except for certain financial services businesses, there is no statutory right to paid leave on bank holidays. Therefore any paid leave given on such holidays can count towards an employee’s four weeks’ annual leave. So, if you currently provide your staff with a holiday entitlement of 20 days plus paid time off for bank holidays, you will not need to increase their annual entitlement, but you should amend the wording governing your holiday entitlements.

Additionally, you should be aware that you may need to address your provisions for holiday in relation to your part-time workers. Currently employers are not required to give part-time employees, who do not usually work on bank holidays, pro rata days off work to reflect those bank holidays. However, from 1 October employees will be entitled to 24 days leave pro-rata irrespective of whether or not they work on bank holidays, so allowance will need to be made for this.

Employers should also address their provisions for accruing holiday during maternity leave (particularly AML when only statutory holiday accrues) and sick leave to ensure the correct entitlement is given. The increases from October 2007 are effective immediately and therefore, where appropriate, additional annual leave will need to be calculated proportionately depending on when the Company leave year starts.

From 1 April 2009, the statutory holiday entitlement will increase again from 4.8 weeks to 5.6 weeks, which equates to 28 days if an employee is working a 5 day week. Again, if you currently provide your staff with a holiday entitlement of 20 days plus bank holidays, you will not need to increase your employees’ entitlement but, you should be aware of and act on the points made and additional implications detailed above.