Holidays Policy

Our Holidays Policy template:

  • easy to use
  • Solicitor-drafted
  • part of our full HR staff handbook
  • complies with current employment law
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How Does It Work?

  • 1. Download
  • 2. Edit
  • 3. Print
  • 4. Sign

With Legalo’s Holidays Policy template you can ensure staff are clear on holiday entitlements, when they can take holidays and how they book them. Our comprehensive policy is easy to use and written in clear English. It comes with a guide to help you use the template and explain the purpose of each section in it. It is up-to-date with the latest laws and rules on holiday entitlements and how to calculate the rate of holiday pay applicable (which is not as simple as you might think in some cases).

Case law has expanded the rights of employees in recent years and this policy ensures you are aware of them and can comply, for example are you aware of the following:

  • holiday entitlements continue to accrue during a period of maternity leave; and
  • a sick employee can claim his holiday leave back.

Other HR Handbook documentation

Legalo has a full range of policies for your HR Handbook if you need individual policies or you can buy the complete set at a significant discount on the price of buying them individually. Click here for full details.

Clauses in this Holidays Policy

The excerpt from the guide to this template below sets out the main features of our Holidays Policy template, so you have a good idea of what it covers:

Policy outline – This section sets out what the purpose of the policy is and how it applies.

While in the third paragraph of this section, please note that if the policy has been approved after negotiation with a trade union, it may have become a contractual term of the employees’ contracts. In such a case, modify the template accordingly by deleting this paragraph.

Annual leave entitlement – This section sets out the annual leave to which an employee is entitled. In the first paragraph, set out the dates the holiday year (annual leave year) runs from and to, or select that it follows the calendar year – delete which option does not apply.

The second paragraph states that if the employee leaves the company or joins it part-way through a holiday year, he or she gets a proportionate entitlement to annual leave.

The next 2 paragraphs set out the number of days annual leave to which they are entitled each holiday year (fill in the number) and that this number is in addition to the statutory bank holidays, so bear that in mind when filling the number in.

The fifth paragraph in this section sets out the current rules on the calculation of the amount of holiday pay due.

The sixth paragraph states that leave not taken in the holiday year is generally lost – it is not normally carried forward to the next holiday year or paid in lieu. Exceptions to this rule are set out in the seventh paragraph, e.g. during a long-term sickness absence or a maternity leave period.

Taking your annual leave entitlement – This section sets out that an employee needs to apply for leave and have it approved. They should not book expensive holidays before having the annual leave approved by the company.

The fourth paragraph notes that some leave might be required to be used in periods of annual shutdown of the company, e.g. over the Christmas period if this normally applies.

Short-term sickness during annual leave – Due to case law, periods of holiday that may have been booked when the employee falls ill can be reclaimed by the employee and treated as sickness absence, instead of holiday leave. While this may be open to abuse, this is the law. Employers therefore need to be vigilant to avoid possible abuse by the employees of this rule. This might include their insisting on the production of a doctor’s certificate confirming the employee is ill. (Legalo has a Sickness Absence Policy template available should you need one.)

Long-term sickness absence and annual leave entitlement – This sets out various rules that only apply if an employee is on long-term sick leave, such as the ability to carry leave forward to the next holiday year or be paid in lieu.

Family leave entitlement and annual leave – Maternity leave (and other similar leave rights) affect holiday rights. Holidays are not lost just because an employee is on maternity leave for a long period – it can often be added to the end of a maternity leave period to extend it (and will be payable as holiday pay).

Termination and annual leave – As noted above, the holiday entitlement is proportionate in a holiday year when an employee leaves the business. The employee may be required to take any remaining holiday during a notice period or be paid in lieu.

In the final 2 paragraphs of this section fill in whether variable elements of pay are or are not included in the calculation of holiday pay in lieu, such as commission, compulsory overtime, travel allowances and performance bonuses.