There is no statutory right for your employees to be off on a Bank Holiday – if you run a pub, for example, or are in the leisure industry as a whole, you will already know that if you had to shut on a Bank Holiday, you would be missing out on a huge amount of business as these days are likely to be very busy for you. You may well need more staff working on a Bank Holiday, not less!
An employee’s contract of employment will dictate whether the employee is required to work on Bank Holidays and will also dictate the payment of the employee for this time. You do not have to pay employees for time off on a Bank Holiday unless the day is taken as a day of annual leave, in which you case you must pay them according to their contract of employment. The statutory minimum annual leave entitlement of an employee is 5.6 weeks and this can include Bank Holidays.
There is also no statutory requirement for hours worked on a Bank Holiday to be paid at a rate higher than that normally paid on any other day. Again, the rate of pay will be addressed in the employee’s contract. If the contract provides that an employee will be paid for the hours worked on a Bank Holiday at an overtime rate, then that is what you should do. Similarly, if the contract states that hours worked on a Bank Holiday will be paid at normal rate, the normal rate should be paid.
As a general rule, payment at a rate lower than that specified in the employee’s terms and conditions could lead to various claims at Tribunal, including breach of contract, unlawful deduction from wages, or ultimately constructive dismissal.
However, regardless of whether you pay at normal rate for the hours worked on a Bank Holiday, or you pay at an enhanced rate, you must also make sure that an employee who works on a Bank Holiday still has the opportunity to take their full annual leave entitlement at some other point during the leave year.
Simply paying the employee, for example, double time as monetary compensation for working on a Bank Holiday and not letting them take another day off is tantamount to paying in lieu, and this is not permitted by the Working Time Regulations 1998 where the employee is continuing in employment. Employees must be given the opportunity to actually be away from work for the whole of their holiday entitlement. The only time you can pay in lieu of holidays is when employment is terminated and you make a payment in lieu of holidays accrued but not taken at the point of termination.
If you have any questions about your employees working Bank Holidays, call the Advice Service on 0844 892 2772 and one of our specialist advisers will be on hand to help.