Holiday entitlements if furloughed

Source: HM Revenue & Customs | | 11/11/2020

The Coronavirus Job Retention Scheme (CJRS) commonly known as the furlough scheme is open to all UK employers and will now run until 31 March 2021. From 1 November 2020, employees will receive up to 80% of their salary for hours not worked with a review date in January.

One common question concerns holiday pay entitlement if furloughed. Employees will accrue holiday entitlement while they are furloughed and can also take leave while on furlough.

If a furloughed worker is not working on a bank holiday they usually take as paid leave, they can agree with their employer to either take it as normal or to take it at a later date.

An employer can continue to claim for a furloughed worker’s wages when the worker takes annual leave. If the holiday pay is more than the employee earned whilst on furlough their employer must pay the difference.

The government has also passed legislation to relax the restrictions on carrying leave between leave years during the coronavirus pandemic. Since 26 March 2020, where it has not been reasonably practicable for a worker to take some or all of the 4 weeks’ holiday due to the effects of coronavirus, the amount not taken may be carried forward into the following two leave years.



 

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