What can employers learn about annual leave after the Ryanair fiasco?

700,000 passengers have allegedly been affected after Ryanair had to cancel flights because of a mix up with its employees’ annual leave. Coodes’ Employment team comments on the lessons businesses can learn.

The Ryanair fiasco was a very high profile example of what can go wrong if an employer fails to properly manage staff annual leave.

A key point the story raised for me is that it is possible for employers to require staff to take holidays on particular days. Employers can utilise a mechanism in the Working Time Regulations to ensure employees take holidays on particular days. This should, of course, be reflected in their employment contracts. The Working Time Regulations also requires that twice as much notice be given to the employees as the number of days the employer wants them to have off – in other words if they want them to take a week as holiday they need to give notice of that two weeks before the start of that holiday.

For an airline like Ryanair, the circumstances will be a little different because pilots will also be covered by air safety regulations that specify when they can and can’t fly. In general though employers can specify mandatory holiday periods, such as a Christmas shutdown. It is also sensible to have a clearly understood holiday booking procedure such as requiring holiday to be booked a certain number of days in advance, and limits on the amount of time off that can be booked in one block.

Employers are not under a general obligation to ensure that employees take all their holiday. However, they should encourage it, not put up obstacles and in some circumstances it will be appropriate from a duty of care point of view to explore why holiday isn’t being taken. Unless a contract says otherwise there is no right to carry over leave into the next year – so from the employee’s perspective it is generally “use it or lose it”.

Employees are always entitled to receive accrued but unused holiday on the termination of employment no matter what the reason for termination. Employers can also deduct from the final salary any holiday taken in excess of accrued entitlement, provided they have a contractual right to do so.

The Ryanair situation is an extreme example of how a business can be affected by failing to properly manage annual leave. I hope it will encourage other employers to review their annual leave policies and procedures to ensure they are fit for purpose.

Our Employment team provide support to businesses helping them keep ahead of recent changes in Employment Law. If you need some friendly advice, call Steph Marsh on 01579 324 017 or send her an email.