Government Consults on Further Reforms of Holidays and Parental Leave

David Reid
17th May 2011

Yesterday, the government opened a consultation process on further reforms to a number of key areas of employment law.

Employment law shared maternity leave

Some of the more interesting reforms relate to annual holidays and the sharing of leave between parents following the birth of a child.


Regular readers of our updates may recall a number of recent European court decisions on the interplay between annual holidays and sickness absence. The government has now accepted that UK law is out of step with European law in this area and plans to legislate to resolve any anomalies.


The principal effect of the proposed changes will be to enshrine in law the principle that if an employee is unable to take annual holidays under the Working Time Regulations due to sickness or maternity/parental leave, they will have the right to carry any untaken holidays into the following holiday year. It is intended, however, that this right will only exist in respect of the minimum four weeks’ annual leave under the European Working Time Directive and not in respect of the additional 1.6 weeks’ annual leave to which UK employees are entitled under the Working Time Regulations.


It is important to note that the right to carry over is only intended to apply where the employee is unable to take holidays due to (for example) sickness. Interestingly, the government intends to allow employers to insist that employees absent due to sickness take their holidays in the current holiday year, even whilst they remain off sick. This should avoid long-term absentees potentially building up substantial entitlements to untaken annual leave over more than one holiday year.


The government is also seeking views on whether employees should be permitted to sell back to their employers the additional 1.6 weeks’ annual leave under the UK Working Time Regulations, or whether it should be possible to agree to defer that additional leave until the following holiday year.


In respect of maternity leave, the government plans that a woman will retain the initial 18 weeks of her maternity leave period, but that the remaining period of maternity leave will be available to be shared between both parents, and will be re-named “parental leave”. It is also intended that each parent will have the exclusive use of 4 weeks of this additional period, and that it will be possible for both parents to take some of this leave at the same time. This change is planned to take effect in April 2015.


It is also intended that every employee in the UK will be able to apply for flexible working. At present, only parents of children under 17 years of age and carers of adults are able to make such applications.


Finally, the government proposes that employers who are found by an employment tribunal to have breached the equal pay provisions of the Equality Act will be required to conduct an equal pay audit.


The consultation closes on 8 August 2011.

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