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UK Employment Law - Does my employer have to carry over or pay for unused holiday entitlement?

My boss just decided that we would no longer be able to carry over holiday from one year to the next. One girl at our firm has five days carried over from last year which she will lose, and six days from this year which she will probably lose. Can the boss do this? Can we just "lose" holiday like this, or do we have to have payment in lieu, or be entitled to carry it over to next year?

It is down to an employer's discretion as to whether they allow holiday to be carried over, however, it is actually unlawful in most cases to be paid in lieu of holiday (http://www.berr.gov.uk/employment/employment-legislation/working-time-regs/rolled-up/page29030.html).

It does seem a little unfair if your boss has only just made this decision, and it has until now been normal working practice that holiday can be carried over, as it does not leave staff much time to fit holidays in if the company's holiday period runs from January to December. However, a lot of holidays will state that holidays can't be carried over unless special permission is given by a director, and the company could use this as a get out by saying that they hadn't been approached for special permission and as soon as they were they declined.

It would be best to apply for annual leave to use the days up by the end of your holiday year, or, if this is not acceptable to your boss negotiate a date in the new year when carried over holidays must be used by (i.e. end of Feb) and be aware that you can't carry any over next year.

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