Statutory holidays Employers beware: take action so that the statutory holidays will lapse!
In a previous blog, we pointed out that in principle an employer cannot oblige an employee to take days as holiday. The strict (and compulsorily applicable) holiday legislation prevents this. However, this does not mean that an employer is completely powerless. If the employer acts actively, accrued statutory holidays of an employee (may) lapse. In this blog, we will explain what action an employer should take.
Statutory holidays versus holidays in excess of the statutory entitlement
Before we discuss the statutory requirements for the lapse of holidays, we must first make a (necessary) distinction between statutory holidays and holidays in excess of the statutory entitlement. Different rules apply to both categories.
- The statutory holidays concern that part of the holidays to which the employee is minimally entitled to. This is equal to four times the agreed weekly working time per year. Therefore, if an employee works five days a week, he accrues (5 days x 4 =) 20 statutory holidays in one year. One can also calculate the holiday entitlement in hours. An employee who works 32 hours a week accrues (32 hours x 4 =) 128 statutory holiday hours per year.
- If the entitlement is more than four times the agreed weekly working hours, this remainder is referred to as holidays in excess of the statutory entitlement. Think, for example, of a provision in an employment contract in which it has been agreed with an employee who works five days a week that he will have 26 holidays on an annual basis. These six ‘extra’ days can therefore be regarded as holidays in excess of the statutory entitlement.
The distinction is important because different regulations apply to both categories. Statutory holidays lapse six months after the calendar year in which they have accrued. Statutory holidays accrued in 2019 may therefore lapse on 1 July 2020. However, this may not occur automatically: the employee must be ‘enabled to actually take holidays’, otherwise the statutory holidays may not lapse. We will discuss this requirement in more detail below. Holidays in excess of the statutory entitlement, on the other hand, are subject to a limitation period of five years, which can be extended thereafter (by so-called ‘interruption’). Holidays that are in danger of being lost due to lapse or limitation, will be taken first if an employee takes days as holiday.
Requirements for lapse of statutory holidays
Statutory holidays accrued in 2019 may lapse on 1 July 2020, provided that the employee has been enabled by the employer to actually take holidays. What does this mean exactly? The European Court of Justice has given an answer to this question. In November 2018, the Court clarified that it must be avoided that the responsibility for ensuring that the right to take days as holiday is actually exercised, lies entirely with the employee. In fact, the Court stated that the responsibility for this lies with the employer. This obligation does not mean that the employer must oblige his employee to take days as holiday, but he must, if necessary, formally encourage the employee to do so. The employer is obliged to ensure ‘concretely and transparently’ that the employee has actually had the opportunity to take his days as holiday. In doing so, he must inform the employee – in a precise and timely manner – that he will lose the accrued statutory holidays that have not been taken. The burden of proof rests with the employer.
Action required from the employer
We therefore advise employers as follows. If an employee currently still has statutory holidays from 2019 (or before), he or she will have to be notified of this. Because this must be done in a precise and timely manner, and because the employer bears the burden of proof, we recommend that the employee (1) will be informed of this as soon as possible, (2) at individual level and (3) in writing. In an e-mail or letter, the employee in question may be alerted to (i) the exact number of statutory holidays accrued in 2019 and/or before that date and (ii) the consequence of not taking these holiday days before 1 July 2020. It should be explicitly pointed out to the employee that the statutory holiday entitlement that will not be taken by 1 July, will lapse as a result. For employees with a large ‘balance’ of statutory holidays, it may be advisable to make a concrete (written) proposal for a period in which the employee concerned can take the days as holiday. In addition, we recommend that after 1 July 2020, the employers confirms (in writing) that the employee’s statutory holidays from 2019 have indeed lapsed.
Would you like to know more about (the lapse of) holidays? Please contact Yvette Dissel (firstname.lastname@example.org) and/or Yillis Smit (email@example.com). You can also reach them by phone on + 31 (0)20 572 7190.