Bank holidays: Contract terms are paramount in relation to employee holiday rights

Apr 28, 2018

By law, employees are entitled to a minimum of 5.6 weeks’ annual leave, equivalent to 28 days’ leave per year for employees working a five-day week.

The 28 days can include bank holidays, of which there are usually eight per year: New Year’s Day, Good Friday, Easter Monday, Early May Bank Holiday, Spring Bank Holiday, Summer Bank Holiday, Christmas Day and Boxing Day. 

There is no statutory entitlement to be paid extra for working on a bank holiday. Therefore, an employee’s contract of employment will be of paramount importance in determining what rights they may have in terms of bank holidays. 

  • Pictured: Pauline Bailey, partner and employment law expert at Howes Percival.

Employment law expert Paula Bailey, a partner at regional law firm Howes Percival, says: "If bank holidays are included within an employee’s statutory minimum holiday entitlement, there is no requirement for the leave to be taken on the bank holidays. Despite this, employers must be careful that they do not unlawfully discriminate against employees who may wish to celebrate days of religious significance. 

“In practice, if a place of work is closed on a bank holiday, an employer can insist that the bank holiday is taken as part of their employees’ entitlement to annual leave.  From the employee’s point of view, the law may imply that they have a right to be paid for bank holidays if the employer traditionally provides for this and the contract of employment is otherwise silent.” 

There is no legal requirement for employees to be paid a higher rate than normal for working on a bank holiday but employers can opt to do so.  Whether or not additional pay is given to employees working a bank holiday is a contractual matter, which should be specifically stated in their contract of employment. 

"Statutory annual leave entitlement for part-time employees is pro-rated to the amount of time they work,” says Paula. “However, part-time workers have the right not to be treated less favourably than a comparable full-time employee and this includes entitlement to bank holidays. 

“If a part-time employee finds they will not be paid for a bank holiday which falls on a day they do not work, this could have the consequence that they are being treated less favourably than their full-time colleagues. Therefore, employers should ensure that employment contracts or policies for part-time workers are carefully drafted to avoid the risk of discrimination.

"Time off or additional pay for working bank holidays is a contractual matter between businesses and their employees.  So, employers need to ensure their terms of employment specify whether a day off must be taken on a bank holiday and clarify payment for working such a day, for example, normal pay rate, time-and-a-half or double time. 

"Most bank holidays fall on a Monday so, to help ensure they meet their obligation to treat part-timer workers no less favourably than full-time employees, employers need to look at how many bank holidays a part-time employee will benefit from in light of the days of the week they work and make sure they receive their full pro-rata entitlement."  

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