What is HR management outsourcing?

HR management outsourcing is when a team of experts manage your HR by looking after your contracts, policies, and procedures.These are the HR essentials every business needs. Without them, your staff could bring successful claims against you, you could lose thousands in legal fines, and even face prosecution. Never underestimate the benefits of HR support for a small business. We have years of experience in providing HR for SMEs and HR management outsourcing. Contact us to see how we can support you, including HR advice for small businesses - as well as medium and large companies.

What is good human resource management?

Good human resource management is having round the clock support when you need it the most.Whenever there’s a staff challenge or an important legal update, you just pick up the phone and get the help you need – no matter the time or place.

What are the benefits of HR outsourcing?

The main benefits of HR outsourcing are:- Cost saving: Reduces the expenses for such things are hiring, training and employing an in-house HR team.- Time saving: Saves time for staff members away from HR tasks.- Improves expertise and compliance: Provides ongoing advice and support to ensure complete and total compliance. - Reduces risk: Reduces the risk of any payroll and compliance failures.

How does HR outsourcing reduce costs?

Outsourcing HR is cheaper than hiring internal staff and saves you money overall when it comes to your HR service. Plus, you avoid making mistakes that could cost you heavily in claims and legal fines down the line. Every business should consider HR support as a way to avoid claims.Peninsula is one of the leading HR outsourcing services in the UK, and by working with us you get access to our HR advisory service. Contact us for your outsourced SME HR today.

What are the key functions of HR outsourcing services?

The key functions of HR outsourcing services are:- Payroll and benefits: Helps a business to manage employee wages, tax processing, and employee enrolment.- Recruitment and onboarding: Helps with job descriptions, sourcing new candidates, interviewing, and ensuring a smooth onboarding process.- Compliance with employment law: Helps to ensure compliance with ever-changing employment legislation.- Employee relations: Helps to manage grievance and disciplinary procedures, and any ongoing support that's required. - HR admin: Helps to handle and manage daily tasks, such as employee records, sorting employment contracts, and processing any leave requests. - Training and development: Helps to create and deliver staff training programs to improve employees' skills.

Can Employees Carry Holiday Over?

Whether employees can carry holiday over typically depends on what’s specified in their employment contract, along with the reason as to why the annual leave wasn’t taken. There isn’t an automatic legal right that enables employees to carry over their holiday. However, certain scenarios dictate that it is permissible—some of these circumstances are legal rights. Firstly, if an employee cannot take their holiday because of statutory leave, then employers must allow for them to take carry over their entitlement of 28 days. Another example if an employee cannot take their holiday resulting from long-term sickness, whilst another is employer failure. This will occur when employers fail to recognise workers’ right to paid holiday, they neglect to provide opportunity or encouragement to take the leave, or if they omit informing the worker that untaken leave is lost until it refreshes. Other circumstances where holiday can be carried over are if it’s a contractual agreement.

On commencement of employment, an employee builds up or accrues holiday entitlement. Employment law entitles an employee to a minimum of 5.6 weeks' leave.

They can take this leave in one particular leave year, which is a 12-month period as set by an employer. Whilst businesses can choose the 12 months that make up a leave year, popular periods are between January and December, or from April to March to match the tax year.

That said, someone will inevitably ask questions about employees carrying holiday over into the next year.

This can be quite a complicated area, so let’s look at what the law says on carrying over holiday entitlement and what is best for your business.

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Can holidays be carried over?

How staff are provided holidays in the UK is outlined below:

Four weeks in line with EU law
6 weeks in line with UK law
Any additional leave the employer wishes to provide

Usually, there's no statutory obligation on an employer to allow an employee to carry leave over to the following year, though this may not be the case where the employee has been on long term sick leave or maternity leave.

Leave may only be carried over if the employer gives the employee permission or if it's stated in the employment contract and/or staff handbook.

Employment law and holiday carry over rules

Employers must ensure that workers and employees have the opportunity to take their full 5.6 weeks’ worth of statutory entitlement in one leave year and must not have holiday days carried over for four weeks.

Employees can carry over the remaining 1.6 weeks, subject to agreement from the employer, as can any additional contractual leave.

As staff should be paid for their holidays, the answer to can holiday pay be carried over is yes.

This changes, however, in several circumstances.

Holiday carry over when sick

When considering carrying over holiday to next year because of sickness, this is a subject that European courts have assessed.

They ruled that the four weeks as prescribed by EU law could be permitted to be carried over if staff could not take them because of being sick.

The Employment Appeal Tribunal has clarified that you should permit this for up to 18 months after the leave year in question.

Carrying over holiday after maternity leave

As staff can take up to 52 weeks of maternity leave and continue to accrue their holidays in this time, employers may also wonder can holiday entitlement be carried over after this leave? The short answer is yes it can.

Whilst the law is not overly clear on this, it is highly advisable to let staff carry over the full amount of statutory leave they could not take because of being on maternity leave. If they take a full 52 weeks of leave, this will be 5.6 weeks.

Whilst the prospect of carrying holiday over maternity leave can make employers nervous, there are ways they can approach this.

For example, as statutory maternity pay ends at 39 weeks, but maternity leave can continue for another 13 weeks, maybe the staff could end their maternity leave at this point and instead take some of their annual leave.

In this way, they will remain off work but receive payment in full, and therefore have less leave left to take at a later date.

Carrying over holidays in the UK because of the coronavirus pandemic

Employment law states that a worker may carry up to four weeks of leave over in this way where it has not reasonably practicable for annual leave to be taken in the leave year to which it relates because of the effects of coronavirus (including on the worker, the employer or the wider economy or society).

This means that there is no automatic right to carry leave over and employers will need to consider the “reasonably practicable” element.

For help, the government produced guidance on 13 May 2020, which sets out that employers should consider various factors when considering whether it was not reasonably practicable for an employee to take leave:

Whether the business has faced a significant increase in demand because of coronavirus that would reasonably require the worker to continue to be at work and cannot be met through alternative practical measures
If they are/were furloughed workers and couldn’t reasonably take statutory annual leave
The extent to which the coronavirus and the practical options available to the business to provide a temporary cover of essential activities disrupted the business’ workforce
The health of the worker and how soon they need to take a period of rest and relaxation
The time remaining in the worker’s leave year, to enable the worker to take holiday at a later date within the leave year
The extent to which the worker taking leave would affect the wider society’s response to, and recovery from, the coronavirus situation
The ability of the rest of the workforce to provide cover for the worker going on leave.

It should be noted that this relates to the four weeks of leave as prescribed by EU law. The remaining periods of leave can also be carried over as normal, subject to employer agreement.

FAQs: Can employees carry holiday over?

Can employers refuse a carry-over request?

Unless there’s a legal right supporting the employee’s request, employers can refuse the request. If the employee had reasonable opportunity but elected not to, then employers may apply a ‘use it or lose it’ policy.

What are employers’ proactive legal obligations?

Employers are not permitted to wait for the year to end and cancel untaken leave. For a ‘use it or lose it’ policy to be valid and enforceable, employers must encourage their workers to take their leave, notify employees that untaken leave will be lost, and ensure there’s sufficient cover for them to be able to take time off.

How much can employers allow employees to carry over voluntarily?

This isn’t a legal requirement, but employers may allow this as a benefit. Employers may agree to carry over up to 1.6 weeks of the legally entitled 5.6 weeks. Any holiday beyond that threshold can be carried over at the employer’s discretion—this should be outlined in the employment contract.

How should employers manage carried-over days?

If an employee uses holiday in the new year, it’s advisable that the employer deducts the carried-over days, ensuring they’re used before any newly set expiry dates.

Can employers pay employees instead of letting them carry holiday?

Unless the employee is leaving the business, payment in lieu in place of the 5.6 week statutory minimum isn’t permitted.

Expert support on leave and absences with Peninsula

Employers have a responsibility to encourage staff to take their full leave entitlement each year. With difficulties or sickness arising in the year, it can be hard for employees to do this. This leaves you unsure about your rights as an employer.

With free practical advice, we can make sure you make the most informed decision. Our services help treat employees with respect, without fear of evoking employment tribunals.

For information about our contracts and documentation advice, drafting and consultancy service, please visit our business service page. You can also call us on: 0800 028 2420.