Regular annual closedowns
The method of calculating the annual holiday entitlement is different where the employer chooses to have a regular or customary annual closedown. This closedown can occur either:
- across the entire workplace (for example, where a company closes over the Christmas/New Year period), or
- for part of an enterprise (for example, where the factory closes for maintenance while the office, dispatch and sales departments remain open).
The employer may implement such a closure only once a year and require employees to take annual holidays during the period of the closedown, even where this requires employees to take time off for which they are not fully reimbursed. The employer is required to provide employees with at least 14 days’ advance notice of the closedown.
The Holidays Amendment Act 2010 clarifies how to determine whether a day that falls during a closedown period would be an otherwise working day in regard to entitlements to public holidays, alternative holidays, sick leave and bereavement leave. See the section on Public holidays during a closedown period.
For employees in their first year of employment, the level of annual holiday pay for the period of the closedown can be established by:
- the employer paying the employee 8% of gross earnings to date, or
- the employer and employee agreeing to the employee taking annual holidays in advance and being paid, even though the employee is not yet entitled to annual holidays.
If you are in doubt, the Department of Labour can assist with guidance by calling us free on 0800 20 90 20.
For all employees whose work is subject to a regular annual closedown, the employer can nominate a date that will be treated as the date that the closedown begins, and on which the employees become entitled to annual holidays. This date must be reasonably connected to the timing of the regular annual closedown. For example, where there is a Christmas closedown, the date could be set at 15 December to ensure that it always comes before the annual closedown commences.
Aside from this, an employer cannot nominate a particular date for annual holiday calculations.
An employer who wants to implement more than one closedown in any year can do so with the agreement of their employee or employees, but cannot direct them to take annual holidays using the above provisions, nor is the date of entitlement to annual holiday adjusted by a second closedown.
