When it comes to annual leave, companies have a responsibility to ensure that their staff take their entitlement.

In a typical scenario, companies often find themselves facing a dilemma when they are going through a particularly busy time and employees have not taken any of their leave so far this year.

As the year is now nearly halfway through, should employees remind staff to take their annual leave or risk losing it once the holiday year ends, or is having a holiday policy that states that enough? 

Employees should be given an effective opportunity to take their annual leave. To ensure this is the case, it is important to do more than simply having a holiday policy.

Since amendments to the Working Time Regulations 1998 took effect on 1 January 2024, employers must give their staff a reasonable opportunity to take leave, encourage them to do so, and inform them that leave not taken by the end of the leave year will be lost.

Should they fail to do this, it could result in the untaken leave being carried over to the next annual leave year, and so it’s best to take steps to ensure that doesn’t happen. Otherwise, employers could be in a worse situation next year when staff members have even more annual leave to take. 

It is worth considering why employees are not taking their annual leave. Are they being prevented from doing so due to staff shortages? Is there so much work they feel unable to be absent? Do they feel it would be frowned upon?

Any of these can lead to serious issues in terms of employee retention, commitment and morale. There is also the risk that employees become burned out and suffer damage to their wellbeing if they do not have adequate time away from work.

If these are issues, it is important to take steps to fix them to prevent lasting damage to the workforce.

Now that we are just under halfway through the year, this is a good opportunity to write to staff to remind them that they should be taking all of their annual leave in the year it is accrued, and that should they fail to do so that entitlement will be lost when the next leave year starts.

Provide information on days annual leave can be booked as well as a reminder of the process to do this, both of which can be an effective prompt for staff to start booking to avoid the disappointment of not getting the days that they want.

Should there be any reasons that might make employees reluctant to take leave, measures that are being / will be taken to resolve them should also be communicated to staff to further encourage annual leave uptake.

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