If I've been furloughed am I paid for Bank Holidays or annual leave?

One in four UK workers has been furloughed from their job as we approach the May bank holiday - but what are their employment rights?

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Since the beginning of the coronavirus outbreak many businesses have struggled to maintain revenue and bring in enough money to pay staff.

In order to avoid a huge number of redundancies and a spike in nationwide unemployment the government intervened with a job retention scheme, known as the furlough programme.

This gives businesses the option to temporarily put workers on a leave of absence but keep them on the payroll while the government pays 80 per cent of the employee’s salary up to a maximum of £2,500 per month.

The scheme has had a massive uptake: on 5 May the government reported nearly one in four UK workers has been furloughed since the scheme began on 20 April.

For the millions now furloughed the situation will bring uncertainty about future employment prospects but also raise questions about entitlements in the short term, particularly as we approach the May bank holiday and the summer months ahead.

Am I entitled to holiday on the furlough scheme?

In government guidance, last updated on 1 May, it says anyone on furlough will continue to accrue leave as per your normal employment contract.

Although the advice is “constantly under review” the latest information says employees are entitled to take holiday.

“You can take holiday whilst on furlough”, it says. “You can agree with your employer to vary holiday pay entitlement as part of the furlough agreement, however almost all workers are entitled to 5.6 weeks of statutory paid annual leave each year which they cannot go below.”

Although it does add that your employer will have flexibility to restrict when leave can be taken if there is a business need (this applies for both the furlough period and the recovery period).

The Advisory, Conciliation and Arbitration Service (ACAS) says holiday should be arranged in the way you would normally sort out holiday with your manager pre-furlough.

“Employees or workers who are temporarily sent home because there’s no work (‘furloughed workers’) can request and take their holiday in the usual way, if their employer agrees.”

Does that include bank holidays?

The government adds that bank holidays should also be included in this if they normally fall into your employment contract.

“If you usually work bank holidays then your employer can agree that this is included in the grant payment.

“If you usually take the bank holiday as leave then your employer would either have to top up your pay to your usual holiday pay, or give you a day of holiday in lieu.”

What am I paid for holiday?

The government advice says working time regulations (WTR) legally require holiday pay to be paid at your normal rate of pay or, where your rate of pay varies, calculated on the basis of the average pay you received in the previous 52 working weeks.

In short, yes you will be paid.

It says: “If you take holiday while on furlough, your employer should pay you your usual holiday pay in accordance with the WTR.”

If this amount is more than would be provided by the 80 per cent government grant at £2,500 per month then your employer is obliged to pay the additional amount.

ACAS also says that furloughed employees are entitled to carry over holiday into next year if they “cannot reasonably” use it in this calendar year.