With the festive season and New Year fast approaching, employers will no doubt be considering a plethora of holiday requests from their employees. It is essential therefore that, to avoid any claims under the Working Time Regulations, contracts of employment, or the discrimination legislation, employers should carefully consider whether their holiday policies are up to date. Below are our top tips to stay merry and avoid seasonal headaches.

1. Prioritizing employees for time off isn’t necessarily a good thing:

Many employees will request the same days as holiday over the upcoming festive period. As employers have the right to balance requests for holidays from their employees with the operational requirements of the business, it may not be possible to allow everyone to take time off at the same time.  An employer cannot, unfortunately, make everyone’s Christmas wishes come true, but treating employees fairly and consistently can minimise the risk of claims of unfairness.

Some particular considerations to be borne in mind:

a) Employees with families
It can be particularly difficult for employees with young children to remain at work during the holiday season as their usual childcare arrangements are not available over this period.
Whilst employers must deal with requests for parental leave and time off for dependents appropriately, there is no legal obligation to favour parents over non-parents when dealing with requests for annual leave. Employers doing so may face accusations of sex discrimination if, say, fathers are treated differently from mothers on the basis of the misplaced stereotype that they are not the primary care providers for young children.

Employers are also at risk from claims of age or sexual orientation discrimination if they prioritise holiday requests from employees with families. This will especially be the case where an employer makes it a condition that only parents with young children may have their holiday request granted over the Christmas period. Such a practice could not only disadvantage women outside child-bearing age but also gay and lesbian employees. The employer would have to show that the practice was justified as a proportionate means of pursuing a legitimate aim, which would then be weighed up against its discriminatory effects.

b) Employees with strong religious beliefs
Since Christian members of staff can in any event attend Midnight Mass on Christmas Eve, there may be little reason why Christians should be given preferential treatment over the whole Christmas period, unless they had planed to observe the whole 12 days of Christmas by attending church. Even so, an employer should be wary of prioritizing requests from Christians for leave over Christmas since it could face allegations of  indirect discrimination from members of other faiths if they are not given such preference during their own religious holidays such as Divali or Eid.

Some employers shut the office for the whole Christmas period. Since employees of different faiths would have to use their annual leave entitlement to celebrate their own religious festivals, this could be seen as indirectly putting employees of different faiths at a disadvantage. If the office is to be shut during Christmas then employers should be clear as to the reasons why this is so. A reasonable justification  may include cost savings since the majority of staff will want to take holiday during the festive period in any event and costs can be saved by closing down completely. The problem does not end there. Employers could face claims of discrimination from employees who do not practise any faith since the legislation protects employees from less favourable treatment not only on the grounds of their religious belief, but also because of their lack of such belief.  Again, a claim will be possible unless the employer can show that its refusal was justified, that is, it was a proportionate means of achieving a legitimate aim.

The problem does not end there. Employers could face claims of discrimination from employees who do not practise any faith since the legislation protects employees from less favourable treatment not only on the grounds of their religious belief, but also because of their lack of such belief.  Again, a claim will be possible unless the employer can show that its refusal was justified, that is, it was a proportionate means of achieving a legitimate aim.

Another consideration to be borne in mind is that if leave is to be prioritized for Christians and non Christians agree to this, the issue of childcare referred to above may still apply as they may also have difficulty accessing childcare over Christmas, as schools and nurseries are closed. 

In light of the above, it is cleat that an Employer will have a huge balancing act in the run up to Christmas and the New Year. Employers would be best advised to maintain a fair policy for granting holiday requests and should specifically state that all employees will be treated equally, but personal circumstances may be considered. Be clear that family commitments and religious reasons will not automatically grant an employee permission to take annual leave, although an employer may take these into account in an attempt to be fair and reasonable.

In sum; while an Employer is not Santa and cannot grant all wishes, that doesn’t necessarily mean he should be a Scrooge either!

2. Dealing with excess holiday at year end

Many employees fail to use their annual leave entitlement during the course of the leave year.  What are an employers obligations when dealing with that untaken holiday.  If employees don’t use it, should they use it? Or is it better to pay the employee a sum in lieu of holiday, or allow unused holiday to be carried over into the next  leave year?  The Working Time Regulations seek to encourage employees to use their statutory minimum annual leave entitlement (28 days for full-time employees, which can include public/Bank holidays) each leave year by placing restrictions on that holiday being encashed or carried over into the next leave year.

• Under the Working Time Regulations, statutory minimum annual leave cannot be replaced by payment in lieu except on termination of employment.  Therefore, if an employee has not used his statutory minimum entitlement to annual leave by the end of the leave year, the employer is precluded from making a payment in lieu of the untaken element.

• In addition, the Regulations preclude the carry over of the first 20 days' statutory minimum annual leave. However, there are some exceptions to this. Such exceptions include absence addressed in recent case law, for example, employees on long-term sick leave who have not had the opportunity to take annual leave (see the European Court of Justice and House of Lords decisions in Stringer v HM Revenue & Customs), and employees who fall sick during periods of annual leave where there is no opportunity to re-take that leave before the end of the leave year (see the European Court of Justice decision in Pereda v Madrid Movilidad SA ).  The next 8 days’ statutory minimum annual leave may be carried over for one year only in limited circumstances, which include where there is a collective or workforce agreement or where the parties have otherwise agreed in writing.

• Employees are, however, entitled to be paid in lieu or carry over any unused contractual holiday, subject to the provisions of their employment contract or the annual leave policy which might include restrictions on the way unused contractual holiday is dealt with.

Azeem Mohiuddin is a Trainee Solicitor in the Employment department at Fox William LLP.