New regulations around annual leave entitlement and pay

In 2023, the government issued two consultations regarding holiday rights, partly in response to the Harpur Trust v Brazel Supreme Court decision in 2022 but also as part of the post-Brexit reforms envisaged under the Retained EU Law (Revocation and Reform) Act 2023 (REUL Act).

European law has heavily influenced UK holiday rights

Following the passing of the REUL Act, there was considerable uncertainty as to whether, and to what extent, previous domestic decisions that interpreted EU-derived holiday rights would apply in the UK from January 2024. Within that Act, the government has the power to restate the principles contained in those decisions so that they continue to apply beyond the end of this year.

Are these regulations in force now?

The Regulations have been approved by Parliament and came into effect from 1 January 2024. Note that some of the key changes will only be effective for holiday years starting on or after 1 April 2024.

Government issued guidance

Full guidance can be found on the Government website, although it does not provide definitive answers to all individual queries. The guidance focuses on the legal minimum entitlement of 5.6 weeks’ paid holiday. Many workers will have contracts entitling them to additional paid holiday beyond the statutory minimum. This additional holiday is known as contractual holiday entitlement. Individual contracts should be checked first, and if necessary, independent legal advice sought.

During consultation, the government signalled its intention to merge basic leave entitlement (4 weeks) and additional leave entitlement (1.6 weeks), maintaining the same amount of annual leave overall, i.e. 5.6 weeks. However, this did not happen. The two types of leave will be retained and remain separate, except for irregular hours and part-year workers who meet the definition in the legislation.

If you have any questions, please do not hesitate to contact our Business Efficiency team on 01273 424904.