Employers often ask the question – How do I resolve a situation where an employee has accrued a significant amount of annual leave?
There are several reasons why an employer might be concerned if an employee’s annual leave balance is becoming significant. When managing workflow, it’s helpful to know if staff are hoping to take a long holiday. Cash-flow problems for the business can result from having to paying out accrued annual leave to the employee, should they resign. Employers may be concerned about an employee’s health and safety – annual leave should be taken regularly to maintain work-life balance. Like most employment relationship issues, the best approach is to resolve matters by agreement. The general principle of the Holidays Act 2003 is that annual holidays are to be taken at a time mutually agreed by the employee and the employer. If an employee requests two weeks of annual leave in a continuous period the employer must grant this request. An employer can direct an employee to take annual leave if the employer and the employee are not able to reach agreement as to when the employee is to take annual holidays.
Normally, the issue is the amount of annual leave the employee has accrued and the need to reduce the balance. So the best approach is for the employee and the employer to sit down and map out a plan for when holidays will be taken. Perhaps agree on a 6 month plan with leave taken at various agreed times during this period. There may be reasons why the employee is reluctant to take a holiday that are important for the employer to be aware of.
Remember, a good conversation resulting in an agreed plan is the best, and right approach, because while the Holidays Act 2003 allows an employer to direct an employee to take annual leave – this power can only be invoked if the parties cannot reach agreement.