European Union: Is Going on Holiday Going Away? UK/EU Employers Confront Challenges Posed By Employees Who Don't Take Their Vacations

Last Updated: September 20 2017
Article by Jonathan Maude and Esther Langdon

While many US employers struggle to make sense of the patchwork of state and local sick leave laws, European Union (EU) employers face a different set of challenges involving mandatory vacation entitlements. In the EU, the law provides employees with mandatory levels of vacation. For example, in the UK, a full-time employee is entitled to take 28 days, while in France, employees receive 5 weeks of vacation (in addition to public holidays).

Surprisingly, many EU employers are finding it difficult to get their employees to take their holidays—either spread out in a manageable way throughout the year, or in some cases, at all. Employees who don't take their holidays—or who don't think about it until November or December—can pose problems for employers trying to manage their budgets as well as for their workforce. Those employees who fail to take the vacation time to which they are entitled can also make it difficult for employers to comply with their obligations under legislation relating to working time, much of which is seen, in European terms, as deeply rooted in health and safety.

There are solutions. Employers can try various initiatives to get employees to take their holidays. One popular option is adopting "Use It or Lose It" policies whereby employees are not permitted to carry over unused holiday days into the next year. Such policies, however, must be enforced with an eye on other employment rights. Employees on prolonged leave for a protected reason—such as maternity or adoption leave, not only continue to accrue holiday, but also must be permitted by law to carry this over so that they have a meaningful chance to use it. Whole volumes could be written about the European law on how holiday is affected by both short-term and long-term sickness, so this is another area to be aware of here.

Some employers have decided to do away with the minimum entitlements described above and go entirely the other way—offering unlimited holidays. At first blush, this sounds like a very attractive initiative, and one which should give employees a sense of empowerment and personal responsibility. Unlimited holiday time is a rather new concept in the UK, where the right to a set period of annual leave is deeply rooted in the public conscience. Some studies suggest, however, that it does not end up encouraging employees to take holidays, and could be challenged in the EU as failing to ensure employees take the level of holiday which the law protects.

Meanwhile, there are a number of industries which have particular reasons to enforce mandatory taking of holiday. For example, institutions regulated by the Financial Conduct Authority are well advised to require, in their contracts and in supporting policies, that regulated employees take at least one block of two weeks' holiday a year. The aim here is to help avoid a rogue trader situation, so that any issues and hidden positions with their books come to light if a trader is unable to manage them for an enforced stretch.

Employers doing business in the EU would be well advised to make sure their employees are using their holiday as it falls due, as hoarding/delaying usage can lead not only to difficult conversations but to a host of legal entanglements.

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Labor & Employment Law Update -September 2017

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