It’s the start of the year, and a time when businesses will be reviewing or putting in place holiday procedures. As a small business owner, you will understand that an employee’s annual leave can impact on your company. Therefore, managing staff holidays efficiently is vital and will help your business enjoy maximum success throughout the year. Owning a small business will require you to fulfil a number of roles; some of which you may feel less comfortable about managing than others. Areas of employment law – including the management of staff holidays – can seem daunting at first, and as a result you may look to outsource your HR function or turn to costly advice for support. However, complying with employment legislation is simpler than you think and the government is at hand to offer free advice to all small businesses when taking on employment related HR issues. For information which clearly articulates how bosses can manage their employment obligations themselves, visit As an introduction, outlined below are four top tips to help you manage staff holidays yourself.

Holiday entitlement

Know how much holiday you can allocate staff. Almost all workers above school leaving age are entitled to at least 5.6 weeks’ paid holiday. You can count any days off for public or bank holidays towards a worker’s statutory holiday entitlement but only if you pay them for these days off. This is the minimum allocation that staff (employees, agency workers and casual workers) should be given. There are different rules for employees working a six-day week so make sure you know your obligations, if this applies to your business.

As an employer, you must set out a worker’s paid holiday entitlement in their contract of employment. To do this, use the written statement of employment at In some cases, there are types of worker who do not have the right to benefit from the minimum paid holiday entitlement so be aware of this.

Holiday Pay

A worker’s entitlement to paid annual leave starts on the first day of employment and is not subject to a minimum period of employment. Ensure you are up-to-date with the different ways pay can be calculated according to the type of work that is carried out. For example, the way that holiday pay is allocated differs for those working fixed hours, for those on variable hours and for shift workers.

Balance business and employee needs

Adopt a good balance between operating your business and encouraging staff to take their full leave entitlement. Giving staff the time off they deserve will keep them motivated and will have a positive effect on your company. Encourage employees to take time off throughout the year so there isn’t a frantic rush before the end of the year to use up holiday allocation around Christmas. It is a good idea to run a report of outstanding holiday a couple of months before the end of the year and remind staff to book and take it. If you work in an industry that experiences seasonal peaks in activity, it may also suit you to lay out rules for when holiday can and cannot be taken or to arrange annual cover.

Notice periods, restrictions and sickness As an employer, you will need to make staff aware that if they wish to take leave, they must give you notice. Agree the notice period with workers and then set this out in writing. If there is no agreement in place, they must give notice at least twice the length of the intended leave period. It may be necessary for your business to restrict the taking of leave; this could include identifying specific periods when leave may or may not be taken, capping the amount of leave that can be taken at any one time or shutting down for certain periods, e.g. between Christmas and the New Year or for a few weeks in August. It is also important to note that a worker continues to accrue their statutory minimum holiday entitlement as normal while absent from work due to sickness.

Remember that managing staff holiday does not need to be a costly or complicated process and government advice is available to help you meet all your employment obligations yourself.

For further information on holiday entitlement or any issue relating to complying with employment law, visit