Annual Leave During COVID-19 Guide for HR
um, this is Ah, Guide, ideally 15 minutes for anyone that works in payroll HR are a business owner who's trying to manage the annual leave situation for employees that are either on fellow are working from home. So just a little bit about myself. And I'm Joan Sanderson Brown. I'm a partner at fact three on and I also head up the people delivery for our clients. So who, in fact three What we are on established cops also provider um, we provide 100 and 50 small to medium sized businesses with coal sourcing solutions for their numbers that people in their systems. Um, with that we've created a dedicated Colvin 19 portal for our clients and for anybody that's that's trying to run a business right now. You can have a look at that and access that free of charge through our website w w dot fact three dot called a UK was absolutely load of resulted in their fact guides, template letters, anything that supports your numbers, people in systems during this quite difficult period. Um, in addition, we have no in response to Corbett 19 But we've been working anywhere on a Act three Hope This is very focused on the people side of life. There's all sorts in there regarding management of your team from automated holiday systems. Uh, absence trackers almost provided an Elektronik personal file for all of you people so that there's one safe space that you can store all of your information. Your documents become particularly relevant with Corbett, 19 because Attendant Ricard's payroll Ricard's Met monitoring when people are off sick when they return when they started for law returned from furl are working from home. It's just one place that you can track everything. So we've got a limited offer at the moment, which is six months free access to the whole if you're interested in that than we are only now to a very limited number of clients and potential clients. So you just contact ALS at the Hello a fact three dot co dot UK. Similarly, if you've got any questions after today and you just want to come, my bike's didn't do feel free to do that. So why Holidays are annual leave and Corbett 19. What We're just getting inundated with questions around this common attic from two different perspectives. Really. One is so how How much leeway to employ his half false holidays during this period? What's the relationship with holidays? Andi Corbett, 19 and for law grants, scheme repayments on the other side of things, which is, you know, business is really, really sort of struggling from a financial point of view to apply the tough hope that comes in with holidays on wanting to actually cancel on employees that it may be working from home. Our for Lord cancel their leave on push that onto another time in the year, or maybe even wondering that, you know, can we carry this fold into next year when we believe that the the economic situations will be a bit more valiant? So this this webinar aims to try and answer all of those questions for you and to help you come up with a strategy that is going to suit your business. But this at this time and we've all bean, we've all been waiting for more detailed guidance around this on this came out from the government from 1/13 of May, um, they publish more detail information, and so the basis of that forms caught a lot of the support that we're looking to give in this particular weapon, So yeah, we're just trying to cover the do's and dont's and help businesses come up The strategy that helps them manage the holiday situation bit more proactively. So what we're gonna be covering in this session, um, the holiday legislation comes from the working time directive 1998. So just a very quick reminder on where you stood. If you like pre call it on holidays. The Corbett 19 Specific changes There's been some legislation, legislative amendments, um, which applies some changes specific to call of it, Who did they change it apply to? If you wish to carry forward or don't wish to carry forward holidays? It's either the case, all the defense for employers and what you could be looking at where Teoh build you started J. And then we take a look at annual leave in particular around impact on furlough bank holidays. What you should be paying people on holiday. Uh, if you wanting to false holiday use if he wanted to cancel militaries on some top tips there as well for businesses that want to pull a strategy together. Andi, communicate that out and we take another will take a glance into agency workers on anybody that's on a zero. I was contract, um, so that we can just have a specific look around on You Will leave and Corbyn 19 for those for those people most types of country. So a quick reminder on working time Directive. Um, the working time Directive 1998 just governs our time at work things like maximum hours, respirator while sting work, rest breaks between shifts and for today's purposes on you will leave. So in terms of annual leave, it dictates a statutory minimum of annual leave of 5.6 weeks per full holiday year. So for a five day worker, this is the 28 days those 28 days off, five weeks at 5.6 weeks can our can not include bank holidays, and that's usually something that business decides upon. I'm rights into the contract. I'm so pretty cove it I'm this legislation required that employees must take four weeks of this 5.6 weeks on that that time needs to be physically taken within their designated holiday year. At the time, there was no, um, no allowance to carry forward any of that four weeks unless you had an employee that was see and requested to carry fall with their leave because they weren't able to take it. Oh, employees on holiday holiday on leave due to maternity our adoption again, you know it's usual, but in those cases, businesses have got the authority to carry forward stop holiday that they're not able to take It also didn't allow businesses to pay in lieu of any of those four weeks. So I, you know, allowing somebody to take two weeks and then pay them the extra two weeks unless the employees actually leaving in that holiday a year. It did allow for 1.6 weeks to be carried over, but only with a very specific agreement with the workforce. So what's changed with Colvin? 19 while the working time Corona Virus Amendment Regulations 2020 of being brought in, Um, this provides a real specific exemption, which is specific to call with 19 on Lee. Um, from what it's allowing businesses to do is where it's not reasonably practicable, and I will come back to that for a work to take. Some are all of their annual leave due to the Corona virus that employees have got the option to allow employees to carry forward up to four weeks of their annual leave. And that's got to be taken within the following two holiday years. Who does it apply to? Well, originally, this was this was put through to support businesses that were adversely affected. Your in Corbett 19. I think the intention was to support from line worker businesses whereby they had to deal with expected increases in absences. So they were asking people Teoh, cancel on You will leave and commune and Commodores that weren't in, um, and to extend working time for those people that of being responsive to the covered 19 crisis. Um, that was the original intention because this is an amendment to the entire regulation anybody that falls within the working time regulation, working time directive, regulations, which practically every business in the UK on there are a few exceptions. But you will know if you are already within the exception group. Basically, what this means is that applies to every single business. So every business has got the option to utilize these amendments and actually, um, tap into the carrying forward anything up to four weeks over the next two years. Now the carrying forward of holidays will either be something that a business a business wants to trigger, or it could be something that the business wants to defend against. So the case for a business making a choice on this, um, should be conceited. And it's something that should be considered as early in the holiday year was possible. Um, there is an overriding obligation for employers to facilitate the taking of the correct holidays are as many of the holidays as possible in the correct holiday yah. And so the cabbie fall would should really only apply when it's not been reasonably practicable for an employee to have taken their leave as a result of Corbett 19 and we'll cover what reasonably practical, reasonable practicable means in a moment. Um, but if if if the carry forward situation is granted that employers should be actively facilitating the taking of any carry forward annual leave at the earliest possible opportunity and for employees that put a holiday requested, say, for example, next year for holidays that they've carried forward from this year, the employer is gonna need a really good reason to decline any of those requests. So what is reasonably practicable? The the guidance asks employers to look at a few different reasons and to come up with their decision as to whether it wishes to trigger the carry forward or not. And they say is to be clear. They see something that a business designed. It's not necessarily something that an employee decides to do. Um, on our advice is to get your strategy pretty clear. And Clinton communicated clearly as early as possible so that employees know where they sound on this. I'm so what is reasonably practicable. You should be looking at whether your businesses faced a significant increase in demand due to Corona virus and that that that that that increase in demand would reasonably require the employees to be at work on. But this being at work cannot be met by alternative practical measures. So they were looking for businesses that have seen a surge in demand for their services. Um, which means that it's they're going to struggle to allow people to take the full amount of annual leave. I should also look at the extent to which your business workforce is disrupted. So if you've had, um, an increase in absence, for example, you've got a high degree of your workforce that is shielding on, but you're struggling to Coverdell's duties with temporary cover. Um, that's another reason for wanting to carry forward holiday. Oh, defend the carrying forward of holiday. You should also look at the health of your employees at this time a make sure that they do take payments of rest of relaxation. We're seeing this a lot more with businesses that have got people working from home. You know, people been working from home since sometimes, you know, mid mid march that the reality now that this could be going on now for some significant time on Andi, people aren't taking holidays because they're not necessarily wanting to work from home and take a holiday. Um, but we've seen some employers forcing some holidays just from a wellness point of view and people taking a break. Um, so again, you know what is it is looking at the health side of things as well. Um, what could also be considered is the length of time that you've got left of the holiday a year. Onda whether that's if that's not gonna be crunched up. Now, when you've got an awful lot of Vanya relief that people need to take within such a small period of time, I'm and they may struggle to take that little a today. That could be a case for or against the carry forward argument. Also, um, the extent to which the work taking the leave would impact the wider society's response to and recovery from the Corona virus situation. So this is obviously to maintain vital services in front line services and being able to sustain and maintain them through the recovery period that we're now that we're now moving into, um, the ability off the remaining workforce to actually provide cover for the employees going on leave and the various skill sets that are required. I'm finally, you know, this is one that we're seeing more mole. If the employer is simply unable to afford the top up payment, which annual leave usually incurs on will cover the financial signed of people going on holiday during favourable. We'll cover that later, but there is a reality developing hit web on um, businesses are struggling in some cases to afford the differential between somebody's furlough payment and somebody's top up payment that has to be applied when somebody's on annual leave and as a result of that, having to, um, postpone Hubble days until the economy picks up all that particular industry pixel. So if we look at annual leave on the fellow impact, I'm, there's a few key messages here. Any employee that is on for law will continue to accrue annual leave exactly as part of their contract of employment. So that statutory and you will leave the 28 days if you're a five day worker lost any contractual enhanced annual leave, I'm. And this is for the entire period of furlough, the impact on annual leave on bank holidays. Again, it's whatever is detailed in contracts of employment. So it is worth while you're going back to your contracts, refreshing yourselves on what have we committed to our what's the current situation with, uh, on holidays? Andi. If bank holidays are part of the 5.6 days or the enhanced contractual entitlement, then they should continue to be taken on the relevant days. So made a perfect example without food bank holidays. If in the contract of employment. It says that find you know you're entitled to 5.6 weeks, and that's includes the normal UK bank holidays. All the normal English bank holidays. Then those days should be taken on the relevant days. I'm if they aren't, if bank holidays and no included in the normal holiday entitlement, then whether you're on forlorn, I has no impact. I'm you may be in a situation for financial reasons and where you actually want to move that bank holiday and give it to the employee is a day in lieu instead to avoid the top up payments that there on those days. If that's the case, then we'll be talking about giving employees notice to cancel holiday, which does include bank holidays as well. Um, and maybe take the metal a two time in the year. You may need employees to work on a bank holiday because your ex you've got exceptional demand right now and that can't be met. Find temp recover or allowing people to take a bank holidays and again look at the flexibility within new contracts of employment. Um, if you go to swap out clause, that's absolutely fine. If you don't have a swap out clause, then you're gonna need to give them the relevant amount of notice off. Seek agreement to give them a whole to give them a holiday back in lieu and all the time. You know, just a word of caution here that if bank holidays are part of the contract and you don't vary them in any way, then there will be some payment impacts. Very likely. So annual leave on bond. Um, the actual payment side of things. Um so the taking of annual leaf, which is either annual leave that's been booked by the employees oh, bank holidays as they fall does not interrupt, fail or in anywhere. And on the days that the holidays have taken all the days that the bank holidays had taken, that employers can still cleared the Corona virus job retention scheme. Graham, which is the 80% of pair captain, 2500 per month for any days that are gone, you will leave all bank holidays. However, the employer is obligated to maintain normal pay on this day, so whilst there could be a contribution to the payment with the Corona virus job retention scheme, monies. That may very likely be a top up to make up the difference. A minimum. This is going to be probably 20% of pair, because you you the Corona virus scheme actually maintained 80% of pay. Um, but let's just look at this in a little book. Bit more depth, because it does depend on how the individual is paid. Um, generally. So what is normal pair? Well, normal pair for people that a salaried, all of fixed earnings, um, will be whatever their salary was the 28th of February 2020. So for dolls, people go to receive another 80% pay. Captain 2500 is very likely to be a minimum top up of 20% there. The people that are on variable I was, um, no valuable pay. The normal pair for them is based on an average of 52 weeks, which proceeds the date of the annual leave where you've got in that 52 weeks where you've got nil pair weeks. For whatever reason, the North nail care weeks need to be swamped towns for all the weeks that have got a payment, that's been one that Father and you can go any back to anything up to 104 weeks. Um, if somebody is on a variable, I was our pay situation, and they don't been with you for 52 weeks, and you just need to work out the average on the weeks, weeks, the weeks that are available to you. So if somebody's been with you for 20 weeks, when you get there, own ings for the 20 weeks you take away any nil pay weeks and he divide that that total pair by 20 to get an average. So here's some examples. So salary to Sally um earned a fixed salary of 32 K at some 36 K On That was her salary as at the 28th of February 2020 which means that her girl sewn into £3000 a month So she's been for Lord. She receives the maximum grant of 2500 Permal. She has a contract which says that as part of a 5.6 weeks worth of holiday 88 days of them are the bank holidays. There's two of them. In May, she's contractually entitled to those We've not varied anything on DSO. What goes throw in her payroll of May um, is a top up for those two days bank holiday. So Sally's normal daily rate is 100 and £38. 46. The fellow red, however, is reduced to £115 on 38 pence per day, which is a daily differential of £23 a so that differential times by the two bank holidays cost the employer an additional £46.16. We've got a person now, one of every different contract, which is variable so free spirited Fred is on a variable contract, and he heard he earns different a different amount of money every week, depending on the hours that you were. But we've done a calculation. Over the last 52 weeks on, we've got, on average earnings gross earnings of £300 per week. He's unfair. Low. Andi receives 80% of the for Lord amount, which equates to Children and £40 per week. He books a week off work his employer tops of his fellow payment to the £300 he would have got How do you have bean in work as normal and not furloughed based on the last 52 weeks. So obviously the differential there cost the employer £60. So what? We're advising clients to dio hes process the Philip Airman as normal. Claim the fella payment through the hatch and revenue customs portal. What you can't claim far is this additional £60 that would need to be put through as well at the employers own car. So and you will leave on bond the full single annual leave, which, you know, as I mentioned earlier, we're getting a lot more enquiries now about how businesses look too false thing, actual taking of holidays by its employees. So the Corona virus situation does not change this whatsoever. But this is just a refresher Aziz to what you can and you can't do. And so the good news is that if employees wished, if employers wish to do so, they can require or force their employees to take annually. Uh, this can include periods of fellow oh, for when people are working from home. And what you do have to do, however, is provide the correct amount of Nolte's, which is double the length of the annual leave being requested. So an example there is. If you wanted to force a week's holiday, then you would need to give people notice two weeks in advance, plus one day and of that of that week holiday starting because the notice has to be given before the first day of notice. If that makes sense, um, a top tip here is that rather than just issued an old taste, I'm doing it in a very compliant way. We tend to see that disputes arise when individual don't understand why. So it's really worthwhile just taking the time to explain rationale around. Why the holidays being boast? Andi. It's also a good idea to actually track the notice being given in the correct way, with some some form of in writing. You know, we don't necessarily expect employees to put a nice light it together, but maybe just a email to follow up a verbal discussion that you've had with the employees that forces the holiday. Um, the majority off business days now are looking to do this for a couple of reasons. Number one. We're trying to get rid of the, um, bottleneck. If act of holidays not being taken now, everybody mobilizing back to work on a huge amount of holiday. Cruel to try and take, um, a time when by way, we need to get back people back into work. But the other side of this is is from a wellness point of view and making sure that people are taking the right breaks. We've got some employees that is struggling to work from home and Google home schooling. We've got half terms, except it's just business is being sensible on giving people the opportunity to take to take some well earned rest. Really, Thea. Opposite to this is businesses that are wanting to counsel annual leave that's been pre booked in, um, all declining holidays that have been requested. So in cases where you can't accommodate holidays for either a financial reason because we understand that there's gonna be a top up payment, um, all that they just need people in work. Then again, the legislation is on ism changed on this, and it is, you know, employers do have the opportunity to cancel or decline employees pre booked on you will leave and even the extent of bank holidays as well on This includes Perry to fellow and also when people working from home. But again, it's all around giving the right, given the right amount of Nolte's. So in this case, the noticed fall counseling holidays at a pretty bold is that the length of time that they are annually, that being canceled, that we match that amount? We do that by and we do that by giving notice that in advance of the noticed period, Um, so it's almost in three Jones's. It's the If you've got, say, for example, a week's worth of holiday, then what you need to do is work back and give people notice at least a week plus one day. So you'd be having a discussion eight days before on a paid off holiday that you wanted to counsel. If it's if it's if it's a week, um, again, Sama tries to avoid despues, and it's particularly for counseling holidays. It is always worth while explaining why, um, and again just following out with a quick email just to track when the notice was given. So as we've talked about what seems to be three men strategies that we are certainly helping our clients with when it comes to annual leave. Um, this is the time strategy whereby the cost of the Topple isn't the businesses priority at all. It's more about making sure that they are avoiding having a bottleneck situation for later on in the air, when people needing to come back to work and mobilize our when they're expects in their industry. It's a significantly pickle on getting people back to work on them, not having a lot of holidays to take when they're back in work and that becomes the primary concert. So in those cases, the businesses are looking to false holidays when when it's quiet, I'm definitely not having to carry forward situation happening. They want to get rid of the holidays. Now, Andi have people free and available at a time when the gonna experience do not lift in in demand. Um, we've got another side of this, which is cost strategy on whereby businesses looking where whether decisions on annual leave is driven by cost, where the cost of the tough poll is becoming the main priority on the annex, a less concerned about holiday accrual, Um, in this case, businesses are looking to counsel holidays. Council bank holiday, so they're not income in the top up fees. They will have this bottleneck effect when people mobilize back to work. But they will have quite a strong carry forward policy so that people can actually carry file with the holidays into the next holiday here on and really saw, you won't get that financial impact off the consolation of them more in the next six months. Um, what we're seeing more and more off. However we certainly with our client base, is a bit of a mixed strategy, but at least a stress A. J and in somewhere shape our farm that defines clearly to the employees what to expect this year and manages expectations. So we have been working with our clients in developing a 2000 and 20. How would he Colisee? That's very specific, which balances out the person's name so, such as you know, the health and well being and taking a rest with the business need. And I'm balancing that with cash flow. So we're tending to see that there's some rationale for doing what they're doing. It then foresee some holidays it encourages, taken of some holidays when maybe the holiday industry is back on its feet so that people looking forward to being able to take some holidays and natural time away legitimately when the returning to work. But it is allowing some carry fold as well, and it's just trying to get that balancing act right for every single business on that. And we are singing the ballad that that is different for each and every business that we're working with. But certainly it's a huge benefit that everybody just knows where they stand with with a specific policy. That's right. Food for 2020. So there's some top tips when dealing with holidays and in particular I've of the forcing all the counseling of holidays. So develop a strategy. Really think about your business. Think about when. Think about the cash flow will think about the health of you of you. People. Think about the bottleneck situation of the impact could have on your business. Develop a strategy that's right for you and clearly communicated. I'm It's always worth while explaining your rationale for why you've got a certain strategy in place so that people understand it and it's more likely to be accepted. Um, the notice periods that we've talked about regarding Boston of holidays and cancelling holidays can actually be overridden. But you've got to ensure that you've got the employees consent. So again, really important there to get to get things in writing to people. Um, you know, the terminology around all the males will be slightly different. It would be, You know, we've had a conversation. You agreed that you would cancel your holidays. Are you agreed to the taking of some holidays? Um, these are the dead's that we grade. I'm you know, just really making it clear. But this is with the employees concerned that this is not something that you are just pushing on them. Andi, do track the notice that you give in writing on to track with compliance. Um, that just obviously defends a situation whereby an employee might have an issue. Would this have been raise? I should, um when you are selecting the force in counseling of holidays, um, make sure that you've got a justifiable business reason for doing now on that, you know, open system, discriminatory challenge. Um, this is helped again by having a company wide strategy. And when we talk about a company wide strategy on holidays. That don't necessarily mean that it that it's the same rule for each area of the business. But as long as you justify, why are you doing what in each area? And it links back to good business reasons. Then again, that will protect you against challenge on discriminatory grounds as well. And this is gonna be a very open down here, Rick. Keeping record is gonna be absolutely vital. Um, keeping a good attendance record for everybody monitoring when people are in work working from home. A fair lord, not fair Lord, when people are off sick, you know, particularly businesses that are linking into the Corona virus job retention scheme grants. You know, we are expecting that almost every employer, if not every employee, will get audited. They're going to be looking for really gold records on attendance. I'm so keeping good records is gonna be vital during this difficult time and again just a link to the hope there. We've got an excellent tracking system with created specific reason called for attendance what you call the 19 related, as you can just simply pull off recourse that just there who was affected, what were the dates etcetera, Um, and again, linked with the record should be itemized payroll records so that people can see where the top hopes have happened on where it is just a flat, forlorn moment. For example, we talked generally about employees, but just to the final a za final look. But something I really think that it's just worth touching on agency workers and those with zero hour contracts. Um, so and you will leave accrual Andi entitlements will be clear in the contract whether that being zero I was employment contract or whether it's an agency worker contract for services. Um, within these contracts, usually on holiday accrual is based on a percentage. Well, I was work. I'm What this means is that whilst individuals are on furlough, they are creaming holidays because they're not working. Um, but it does mean that while someone fell ill, they can take annual leave, and like everybody else, they can still have holidays. Um, false cancelled on them as well. For the various reasons that we talked about earlier, um, these people will absolutely be cost is variable hours and pair people. And so their holiday pair, whether it is forced or whether it's just taken, um was part of the request. Will certainly, um based on this 52 week average, um, under the reminder to swap out menial pay weeks, um, they are very likely to require a top up in the majority of cases we would expect because it's likely that they're receiving 8%. A normal pair will take them up to 100%. Um, all these tricky calculations on do need some time and thought so if you've got agency workers, um, I was eight people zeros. Contractors provide yourself with a little bit more time to think about strategy around these, Um, if you want in payroll that again and give yourself a little bit more time because the calculation side of things is, you know, quite tricky to to navigate through. So hopefully everyone's found that, uh, useful Um um, some clarity. Some much needed clarity from from the government on a little bit of slump there on what we are seeing within our own client portfolio. Where here always. If you've got any questions, you can email was that Hello? What factory dot co dot UK? Just a quick reminder regarding the portal as well. The recorded 19 portal, every bit of covered 19 related materials that we are producing gold into the portal so dated almost daily. Um, we've got a fact sheet on the holiday situation, and the slides from this weapon now will be on there as well. And you can just visit our website for that burrito. We got fat three dot com that you care, and it's it's on the home page. You simply just click, you know, access to the hob on it, and then you go. And then from that point, you'll you'll start to receive updates as we as we push information into their on a daily basis. And if anybody is interested in keeping, uh, excellent attendance recalls, we've got six months free access to our hope. If anybody is interested, we are only offering that to a limited number of businesses. And so, if you're interested again, just contact with Hello, what factory dot co dot UK. But it's a portal for everything people was attendance truckers in there, the ultimate holiday bookings with with with an email system, which is excellent for more about working where you got manages away from from work for employees. Still wanna book holidays? There's an electronic personal files dropped database in there. There's a way of you releasing company announcements to employees. Ondas, a self service option there for employees, talked about their personal details, which is really vital on this difficult time, where everybody's trying to get hold of everybody on with daily announcements on what's happening when people mobilizing but work, etcetera. Andi, we've got some off some social media handles there for you to be able to connect him with those, um, engaged with us moving forward. So hopefully founder of use If you've got any problems whatsoever, any queries? If you want help will instruct holiday strategies together, then contact ALS on Hello, work back three.
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