25/03/2025
Bank and Public Holidays : Could there be an issue?
In England and Wales there are, generally, eight bank holidays in every calendar year:
• New Years’ Day,
• Good Friday,
• Easter Monday,
• two May bank holidays,
• August bank holiday,
• Christmas Day
• Boxing Day
In recent years we have had some bonus bank holidays including Queen Elizabeth’s Platinum Jubilee and the coronation of King Charles III.
Most of our bank holidays are ‘fixed’ in terms of when they fall being on a specific date. The exception is the two Easter bank holidays which move around as the timing of Easter changes to fall in line with religious calendars.
Easter fell in March last year, but this year it isn’t until mid-April. This means that there will only be seven bank holidays between the period 1 April 2024 and 31 March 2025.
This could have an impact on employers whose holiday year runs from 1 April-31 March. If workers are only entitled to statutory minimum holiday then employers might be legally obligated to give them an extra day of holiday.
Who Needs to Act?
Employers must review their contracts and assess whether they need to adjust holiday entitlement in order to comply with the Working Time Regulations 1998.
Here's a breakdown of the different scenarios:
1. Holiday Clause "28 Days Including Bank Holidays"
If the employee's contract states that they are entitled to 28 days of holiday per year, including bank holidays, there is no issue. In this case:
• The employee will take seven bank holidays off.
• The remaining 21 days will be available for the employee to take as annual leave at a time of their choosing.
Result: The worker will receive their full statutory minimum holiday entitlement (28 days), so no extra day is needed.
2. Holiday Clause "20 Days + Bank Holidays"
If the contract states 20 days of holiday + bank holidays (or similar phrasing), the issue arises because the worker will receive only 27 days off in total, rather than the statutory minimum of 28 days:
• The worker will get seven bank holidays off.
• The remaining 20 days of annual leave will be taken as per normal, totalling 27 days in total.
Result: The worker is underpaid by one day of holiday entitlement. In this case, employers must take action.
What Should Employers Do?
If workers are at risk of receiving less than the statutory minimum, employers should take one of the following actions:
Option 1: Offer an Extra Day of Holiday
• Action: Employers should offer employees an additional day off (beyond the 27 days) to ensure that they receive the statutory 28 days of annual leave.
• Timing: This should be done before 31st March 2025 to ensure it falls within the 2024-2025 holiday year.
• Clarity: Employers should make it clear that this offer is specific to the 2024-2025 holiday year due to the timing of Easter.
Option 2: Do Nothing and Wait for a Challenge
• Risk: If employers choose to do nothing, they risk being challenged by employees for unlawful deductions from wages for underpaid holiday entitlement.
• Legal Risk: Employees could bring claims before an Employment Tribunal for underpayment of holiday leave, which could result in penalties or compensation being awarded.
• Note: The fact that there were nine bank holidays in the 2023-2024 holiday year, meaning employees received more than their minimum entitlement, will not be a defence. The tribunal will only consider the 2024-2025 holiday year.
HR Audit Checklist for Employers
To assess the potential impact on workers, HR should:
1. Check the Holiday Year:
Confirm the holiday year for all employees, specifically those whose holiday year runs from 1st April to 31st March.
2. Identify Employees with Statutory Minimum Holiday:
3 Identify which employees are entitled to the statutory minimum holiday of 28 days (including bank holidays).
4 Review the Holiday Clause:
5 Check how the holiday entitlement is structured in the employee's contract.
28 days including bank holidays: No issue.
20 days + bank holidays: Potential issue.
4. Assess the Risk:
If employees have a "20 days + bank holidays" clause and are affected by the late Easter, employers should consider offering the extra day of holiday.
If the risk is low (e.g., if there are only a few employees affected), employers may choose to offer the additional day off to avoid legal risks.
It's a one-off issue, Easter will fall in April again in 2026, so the situation should return to normal for the 2025/26 holiday year.
If you need more guidance on handling this or any further details please contact us by email at [email protected].
