If your holiday year runs from January to December, it’s time to start reminding people to book any outstanding holiday they may have.

If your policy is ‘use it or lose it’ i.e. if you don’t take your holiday in the current holiday year you will lose it, then you MUST remind people to be able to do this.

We have reported this case before, but as we are approaching what will be the end of the holiday year for many employers, it’s worth repeating.

The case was at the ECJ (European Court of Justice) and gave important clarification about the step’s employers must take if they wish to enforce the “use it or lose it” rule for holidays at the end of the leave year. This rule sets out that if a worker does not take their holiday leave in the current holiday year, they will lose it.

It was decided that a worker should NOT automatically lose their right to paid annual leave because they did not apply for it, unless the employer could demonstrate that the worker deliberately refrained from taking the leave “in full knowledge of the consequences”.

The court went on to give guidance on what would be required and said that the employer must inform the worker of the leave they have outstanding and in good time for them to take it. If the worker still does not take leave, then they will lose their right.  

Importantly the onus is on the employer to prove that they have communicated this and to show that the worker was able to take annual leave. Any communication to the worker must also confirm that untaken leave will be lost if not taken.

Therefore, to be able to rely on the ‘use it or lose it’ principle, you need to clearly communicate this and keep records to demonstrate this.

One solution is to use YourHR.space.  This can ensure you have the right policies in place, so that employees can easily see how much holiday they have remaining, and you even send announcements to remind them.

If you feel you need guidance or advice on this matter or to learn more about YourHR.space then please call Practical HR on 01702 216573 or email angie@practicalhr.co.uk.

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