With the summer holidays in the not too distant future, many business owners are often too nervous to ask the question:
“Can I refuse or cancel an employee’s holiday?”
Striking a good work-life balance is hugely important for team morale, with annual leave playing a key role in staff well-being. However, it’s also important that your team have the best interests of the business in mind when requesting time off work – and understand that an employer is well within their rights to refuse a request for annual leave or even cancel pre-approved annual leave if it’s crucial to the needs of the business.
Managing expectations
As an employer it’s your responsibility to have rules in place about booking annual leave. These should be clearly outlined in the employee’s contract of employment or employee handbook.
Within this you should set out how much notice an employee needs to provide, the process for requesting annual leave and how many consecutive working days can be booked at one time. You may also want to stipulate the maximum number of employees allowed to take leave at the same time and reserve the right to refuse or cancel holiday where required.
Unless otherwise stated in the contract or handbook, employees should provide notice that is at least twice as long as the amount of annual leave they would like to take. For example, if an employee wishes to take one week of annual leave, they must provide you with at least two weeks’ notice.
Refusing holiday requests
An employer can refuse a request for annual leave, and it’s not uncommon for several members of a team or department to want to take holiday at the same time – particularly around school holidays, Easter and Christmas.
Most employers adopt a first-come-first-served approach to approving annual leave, encouraging longer notice periods and therefore enabling better business planning for periods when team members are away.
As an employer you are legally allowed to refuse a request if you feel the needs of the business cannot be met if several people are off at the same time.
You are also within your rights to prohibit employees from taking annual leave at particularly busy times as well as insisting employees take annual leave at certain times of the year. For example, if you close the office at Christmas you can make it policy that employees must allocate a set amount of days of their annual leave allowance to cover this time period.
To say no to a request, you must give the employee counter notice equivalent to the period of leave the employee was trying to book. So, if an employee wishes to take a week of annual leave, you must refuse this request at least a week before the leave is due to commence.
Cancelling previously approved annual leave
The law does allow an employer to cancel an employee’s annual leave that has previously been approved if there is a business need. However, the exception to this rule is that you cannot cancel leave if it means that the individual is then unable to take their full statutory annual leave entitlement in that leave year.
To cancel leave, you must provide notice equivalent to the period of leave the employee planned to take and have seriously considered all the other options available.
If you cancel someone’s leave which means they cannot take a booked holiday and they suffer financial loss, they may be able to argue constructive dismissal or a breach of the implied duty of mutual trust and confidence.
Being transparent with the expectations of staff and the reciprocal obligation of the employer from the offset can help avoid any unnecessary disappointment from the team, as well as protecting your business.
How Nelsons Can Help
If you require advice on this subject, please contact another member of the Employment Law team in Derby, Leicester, or Nottingham on 0800 024 1976 or via our online form.