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Workers missing out on £3.1 billion of paid leave

One in 14 UK workers are not getting their full legal holiday entitlement, according to TUC analysis

It estimated that nearly two million employees are not getting the minimum paid leave entitlement they are due, and more than a million are not getting any paid leave at all. This equates to £3.1 billion of paid leave each year.

The analysis showed that women are the most affected, with 8.3% missing out on paid leave compared to 5.9% of men.

This year's findings show a slight improvement on similar research carried out by the TUC this time last year, which found that one in 12 UK workers were not getting their full paid leave entitlement, with 2.2 million affected.

The sectors with the highest numbers of staff losing out on their legal paid holiday entitlement this year were education (341,000), retail (302,000), and health and social care (264,000).

The TUC cited workers being set unrealistic workloads that do not allow time to take leave, employers deliberately denying holiday requests and managing out people’s leave, and employers not keeping up to date with the law as the main reasons for people missing out on holiday pay.

Minimum holiday entitlements are a vital part of reducing overwork, the research stated. People who work excessive hours are at risk of developing heart disease, stress, mental illness, strokes and diabetes, which also affect co-workers, friends and relatives.

In light of the research the TUC is renewing its call, also made last year, for HMRC to be granted new powers to clamp down on employers that deny staff their statutory holiday entitlement. This would include the power to ensure workers are fully compensated for missed holidays.

TUC general secretary Frances O’Grady said employers have no excuse for not paying staff holiday leave. “Every worker deserves a break to spend time off with friends and family. But millions are missing out on the paid leave they are owed. British workers put in billions of pounds' worth of unpaid overtime as it is. Employers have no excuse for robbing staff of their leave," she said.

“The government must toughen up enforcement to stop bosses cheating working people out of their holidays. And ministers must not resurrect tribunal fees, which stopped people enforcing their rights.”

However, partner in the employment law team at Royds Withy King Malcolm Gregory commented that annual leave is a complex issue, with many in fact consciously choosing not to take the time they're entitled to.

“It’s inevitable that some workers will not take all of their minimum holiday entitlement. It has always been a mixed picture – with some workers choosing not to take their entitlement and others being put off from doing so by unscrupulous employers,” he said.

"The law has prescribed minimum paid holiday since 1998 and workers’ rights in this connection are reasonably well known. This issue is not just about employers flouting the law, but also workers taking responsibility for their wellbeing and understanding the health implications of not taking a reasonable amount of time off. Workers who wish to complain can do so and will be in a strong position to enforce their legal rights.”

But Gregory added that while managing leave can be challenging, employers have a responsibility to do so correctly: “With flexible working increasingly being implemented in many organisations, managing resources when workers are taking time off for any reason can be a challenge but there is no excuse for not doing so."

Emphasising the importance of leave and of healthy working practices may be more effective than higher levels of enforcement, Gregory said.

"I don’t see that introducing more enforcement powers will make a significant difference to the statistics released by the TUC. Ultimately this issue is only really policed by worker complaints. They already have the legal right to complain to an employment tribunal for compensation. Provided the tribunal system remains free to use there is no barrier to justice," he said.

“A more effective solution for this issue might be to consider how the health and wellbeing agenda can be publicised to greater effect. If the message is heard widely by all workers it will be difficult for employers to turn a blind eye to the existing law. We have seen good levels of awareness from government campaigns such as pension auto-enrolment in recent years and there is no reason why this could not be replicated around this issue.”

The number of people making unpaid holiday claims has more than doubled since tribunal fees were abolished in 2017, following a legal victory by Unison. The majority of holiday pay cases are found in the claimant’s favour, with values ranging from £18.94 to £11,000. Most are for a few hundred pounds.