Should employers be jubilant about the Queen’s Diamond Jubilee bank holiday?

Dear Auntie,

The Queen’s Diamond Jubilee provides an extra bank holiday this year on Tuesday 5 June. How will this effect my staff’s holiday entitlement for 2012 and should I be taking any steps to deal with this?

Regards,

Mrs Windsor

Answer:

Although the announcement of an extra bank holiday will no doubt have pleased many employees across the country, it is essential that employers fully understand their staff’s holiday entitlement to avoid any operational difficulties or cost burdens.

Holiday entitlement

Full-time employees have a statutory right to a minimum of 28 days’ holiday, 8 days of which represent the number of bank holidays in a year but need not be used for them. A part-time employee is entitled to 28 days’ holiday reduced pro rata, according to the number of days they work each week.

There is no automatic right in England and Wales for a employee to have the day off on a bank holiday or, if they work on a bank holiday, for them to be paid overtime or given time off in lieu. A employee’s entitlement to the extra bank holiday will depend on their contract of employment.

Steps to take

You will need to check your contracts of employment to find out what your contractual position is regarding your employee’s entitlement to bank holidays. Below are some of the common contractual entitlements found in employees’ contracts:

1. Entitlement to a certain number of days’ holiday plus bank and public holidays

Employees with such contracts will be entitled to take the additional bank holiday unless their contract refers explicitly to holiday plus “the usual” or “eight” statutory and bank holidays.

2. Entitlement to a number of days’ holiday inclusive of bank and public holidays

Employees with such contracts will be entitled to take the additional bank holiday but the employee would have to take the additional day from their annual leave entitlement rather than being giving an extra days’ holiday.

3. Entitlement to a fixed amount of days’ holiday with no reference to additional entitlement to bank and public holidays

Such employees will not be entitled to take 5 June as a bank holiday and it will be at the employer’s discretion whether to grant them annual leave on that day.

Part time employees

Broadly, part time employees should not be treated less favourably then their full time colleagues on the ground of their part time status. A simple way to do this is to ensure that part time employees are entitled to an equivalent pro-rata holiday entitlement as their full-time colleagues. This means that where full-time employees are entitled to the additional bank holiday, their part-time colleagues should be entitled to such additional holiday calculated on a pro-rata basis.

For employees who do not work on a Tuesday, they will need to be given their extra holiday entitlement on a day when they would usually be working.

Decisions Decisions

Whilst employers must also ensure that they have enough staff to keep their business running if they plan to operate during the bank holiday, they should keep in mind however that it is also likely to damage morale if you allow some employees to have an additional bank holiday (because this is permitted by their contract) but not those whose contract does not permit the additional day.

Further, there is also the decision as to whether employees will be paid for this additional bank holiday. There is no statutory obligation on employers to pay normal pay and it may indeed be an extra cost that struggling businesses wish to avoid. Employers are therefore, subject to their contracts of employment, free to choose whether to pay their staff for this additional bank holiday.

Employers will need to balance the benefits of making a payment of normal wages against the cost of doing so, whilst keeping in mind the potential negative employee reaction if no payment is made. Any payments that are made should be determined in advance according to contracts of employment to avoid any uncertainty.

Holiday requests

Employers are likely to receive an influx of holiday requests for the three days following the Queen’s Jubilee (6-8 June) as employees will be looking to take a week’s break during the half term holidays. If you do not already have one, consider putting in place a procedure to help you consider such requests fairly. This can be done on a first come first served basis or using a ballot type system. The most important rule to avoid unfairness is to tell people what the system is and stick to it!