 Wish you were here ( 260kb) - A CAB evidence report on the paid holiday provisions of the Working Time Regulations 1998
Executive Summary
i.Based on evidence from over 300 Citizens Advice Bureaux (CABx) throughout England, Wales and Northern Ireland, this report shows that many workers are being denied their legal right to at least four weeks’ annual paid holiday – a statutory entitlement under the Working Time Regulations 1998.
ii.Since May 1997, the Government has adopted an integrated approach to the enhancement of employment rights that recognises that individuals work best – to the benefit of their employer – when they are able to achieve a personally fulfilling balance between work, family and other aspects of their lives. As the Government puts it: “work-life balance is an issue whose time has come”. In providing for a right to a minimum of four weeks’ paid holiday, the Working Time Regulations undoubtedly play a major part in this drive to enable workers to achieve an appropriate work-life balance.
iii.Yet the evidence from CABx indicates that a significant number of workers – many of them low paid – are still not enjoying their right to four weeks’ paid holiday per year. In some cases, this failure stems from an apparent lack of awareness – or full understanding – of the Working Time Regulations. More often than not, however, it stems from deliberate non-compliance, with employers using a range of excuses and devices to avoid meeting their statutory obligations to their workforce. These include falsely stating that the worker does not qualify because he or she is “only” a part-timer or that there is no paid holiday in “this line of work”, claiming simply that the employer “cannot afford” to give paid holiday, and making inadequate adjustments to workers’ pay in lieu of actual paid holiday. And some employers have exploited the coming into force of the Regulations to reduce the existing (i.e. contractual) and more generous holiday entitlement of their workforce.
iv.Whilst pubs, hotels, restaurants, nursing and care homes, shops, hairdressers, and cleaning companies feature heavily amongst the employers complained of by CAB clients, the evidence shows a surprisingly wide range of employers failing to meet their legal obligations under the Working Time Regulations. Firms of professionals, local authorities, and large-scale private sector employers are also represented in our evidence. And, due to shortcomings in the Regulations, many workers in the transport sectors find that they have no statutory entitlement to paid holiday at all.
v.In some cases, CABx are able to assist the client in approaching his or her employer, with a view to securing their proper entitlement to paid holiday. But where the employer fails to respond positively to such an approach, the only means of enforcement is to bring a complaint to an employment tribunal. The evidence from CABx shows that many workers are reluctant to initiate such a complaint – or even to approach their employer – for fear of suffering victimisation by their employer and even of losing their job.
vi.Indeed, the evidence confirms an all too familiar aspect of CAB clients’ experience of the labour market – their vulnerability in the face of poor employment practice by some employers. For many, the issue is stark: an effective choice between accepting unsatisfactory (and illegal) terms of employment, or being (unfairly) dismissed. This report describes a number of cases where the worker’s assertion of his or her right to paid holiday resulted in dismissal.
vii.The CAB Service believes that the Government needs to take steps to address this situation. At a most basic level, there is a need to establish the full extent and nature of employers’ failure to meet their duties under the paid holiday provisions of the Working Time Regulations. We recommend that the Department of Trade and Industry conducts – or commissions – research on compliance with the Regulations in the UK economy as a whole. This research should then inform governmental action to promote awareness and achieve higher rates of compliance.
viii.Notwithstanding the need for such research, we conclude that the Government could do much more to promote compliance and good practice on the part of employers. We recommend that the Department of Trade and Industry conducts a review of the guidance on the Working Time Regulations available to employers, and of the Department’s promotion of that guidance. This review should give particular consideration to whether the guidance adequately addresses the position of those groups which appear to face the greatest difficulty in obtaining their full entitlement, such as part-time workers, agency and temporary workers, and those supposedly self-employed but actually subject to an employer-worker relationship.
ix.We note that, in March 2000, the Government launched a Work-Life Balance Campaign, aimed at encouraging employers to introduce flexible working practices which enable their workforce to achieve a better work-life balance. It would be regrettable if the initiatives taken as part of this Campaign did not reach or benefit the workers whose experiences are described in this report. Accordingly, we recommend that that the Department of Trade and Industry and the Department for Education and Employment take steps to ensure that current and future initiatives under the Work-Life Balance Campaign focus on those employers – such as small firms and those in low profitability sectors – who face the greatest challenge in meeting their statutory duties to their workforce.
x.We further recommend that the Government undertakes an examination of the scope for further financial incentives and assistance for those employers who face the greatest challenge in meeting their statutory duties to their workforce.
xi.Our evidence highlights three particular shortcomings in the provisions of the Working Time Regulations. Firstly, there is ambiguity in the provisions relating to how holiday pay must be paid to the worker. This ambiguity is open to exploitation. We recommend that the Government amends the Working Time Regulations (and associated Guidance) to clarify employers’ obligations in respect of payment of holiday pay.
xii.Secondly, our evidence shows that the inclusion of the eight bank holidays within the statutory entitlement to four weeks’ paid annual leave has encouraged some employers to reduce the previous (i.e. contractual) holiday entitlement of their workforce. We recommend that the Government reviews the legislative provision in respect of bank holidays, as well as the level of entitlement to paid holiday under the Working Time Regulations. The review should examine the scope for closing the gap between the statutory minimum entitlement to paid annual leave and the (considerably higher) national average level of contractual paid annual leave.
xiii.Thirdly, the evidence highlights the exclusion from the scope of the Regulations of workers in the transport and other specified sectors. We recommend that the Government takes urgent steps to extend the scope of the Regulations to those workers in the currently excluded sectors, in line with a recent decision of the European Union to so extend the scope of the EU Directive on which the Regulations are based. Whilst, under EU law, the Government has up to three years to implement this revision of the EU Directive into national law, we can see no credible reason why the Government should not act immediately.
xiv.Most importantly of all, we conclude that a number of factors – and especially the fear of losing one’s job – prevent or deter many aggrieved workers from taking remedial action to enforce their right to paid holiday. We therefore recommend that the Government conducts a review of the arrangements for ensuring compliance with the provisions of the Working Time Regulations – and indeed with other statutory employment provisions.
xv.More particularly, we recommend that the Government establishes new, pro-active enforcement mechanisms, in the form of a dedicated enforcement body charged with ensuring compliance with a range of statutory employment provisions (such as the rights to a written contract, to itemised pay slips, to statutory sick pay, and to maternity leave and pay, as well as the rights set out in the Working Time Regulations). This general enforcement body should be empowered to investigate and follow-up named, anonymous and third party complaints, to carry out random spot checks on employers, and to impose effective penalties in the event of non-compliance.
Social Policy contact: Richard Dunstan Social.policy@citizensadvice.org.uk
Wish you were here ( 260kb) - A CAB evidence report on the paid holiday provisions of the Working Time Regulations 1998
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