Can an employer insist on an employee using holiday entitlement during their notice period when on garden leave?
The employment contract continues to subsist during any period of garden leave. Therefore, the employer must continue to:
- Perform all the terms of the contract.
- Pay salary at the normal time.
- Provide all other contractual benefits, such as medical and pension benefits and company car.
- Allow the employee to exercise their normal holiday entitlement, and calculate holiday pay in the usual way.
Under regulation 18 of the Working Time Regulations (Northern Ireland) 2016, an employer can specify dates on which an employee must their statutory annual holiday entitlement, provided that advance notice is given (twice as many days in advance of the earliest day of annual leave). For example, the employer would have to give at least two days' notice in advance of the start date of one day’s holiday. This notice period can be varied by a relevant agreement.
Therefore, an employer may require an employee to use up any outstanding annual leave during a period of garden leave. However, if the period of garden leave is not long enough for all outstanding holiday entitlement to be used, the employee should be paid for the remaining accrued but untaken annual leave on termination.
Please note, the above advice relates to statutory holiday under the Working Time Regulations (Northern Ireland) 2016. The rules regarding any additional contractual holiday entitlement provided should be clearly set out in the employee’s contract or staff handbook.
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