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4 tips to help small businesses manage staff holidays

January 21, 2011

Managing time off for employees can be a real problem for small businesses. With a small team, having just a few members of staff on leave can make things difficult.

Seasonal factors also mean that for many small businesses, there are very busy times of the year. When combined, these two problems can be a big headache, when a number of employees all want to take holiday at this busy time.

Therefore, it is important for small business owners to manage staff holidays efficiently to ensure that the business isn’t affected by absences and can continue to operate smoothly. Well as smoothly as any small business ever runs!

To help you manage staff holidays, particularly with seasonal issues in mind, here are four top tips to help small business owners tackle the issue.

1. Balance business and employee needs

As a small business owner, think about the ways in which you handle staff holiday. Adopt a good balance between operating your business and encouraging staff to take their full leave entitlement. Giving staff the time off they deserve will keep them motivated and will have a positive effect on your company.

Encourage employees to take time off throughout the year so there isn’t a frantic rush before the end of the year to use up holiday allocation around Christmas. It is a good idea to run a report of outstanding holiday, a couple of months before the end of the year and remind staff to book and take it.

If you work in an industry that experiences seasonal peaks in activity, it may also suit you to lay out rules for when holiday can and cannot be taken or to arrange annual cover.

2. Holiday entitlement

Know how much holiday you can allocate staff. Almost all workers above school leaving age are entitled to at least 5.6 weeks’ paid holiday.

You can count any days off for public or bank holidays towards a worker’s statutory holiday entitlement but only if you pay them for these days off. This is the minimum allocation that staff (employees, agency workers and casual workers) should be given.

There are different rules for employees working a six-day week so make sure you know your obligations, if this applies to your business.

As an employer, you must set out a worker’s paid holiday entitlement in their contract of employment. To do this, you need to have a valid written statement of employment. In some cases, there are types of worker who do not have the right to benefit from the minimum paid holiday entitlement so be aware of this.

3. Holiday pay

A worker’s entitlement to paid annual leave starts on the first day of employment and is not subject to a minimum period of employment. Ensure you are up-to-date with the different ways pay can be calculated according to the type of work that is carried out.

For example, the way that holiday pay is allocated differs for those working fixed hours, for those on variable hours and for shift workers.

4. Notice periods, restrictions and sickness

As an employer, you will need to make staff aware that if they wish to take leave, they must give you notice. Agree the notice period with workers and then set this out in writing. If there is no agreement in place, they must give notice at least twice the length of the intended leave period.

It may be necessary for your business to restrict the taking of leave; this could include identifying specific periods when leave may or may not be taken, capping the amount of leave that can be taken at any one time or shutting down for certain periods, e.g. between Christmas and the New Year or for a few weeks in August.

It is also important to note that a worker continues to accrue their statutory minimum holiday entitlement as normal while absent from work due to sickness.

More help on tackling employment issues

There is some useful, free advice to help small businesses comply with employment legislation on the Gov.uk site here.

For more tips and guidance on staff-related issues, try some of ByteStart’s other guides;

ByteStart brings you help and tips on all aspects of starting and running a small business. Check out some of our most popular guides;