Working Time Regulations (WTR) can prove confusing for small businesses. That's why we thought we'd lend a hand by helping HR managers - just like you - understand how WTR can affect holiday and what things you need to avoid.
What are the Working Time Regulations?
The Working Time Regulations 1998 put a limit on the number of hours that workers can work each week.
The basic provisions of the Working Time Regulations state that employees are:
- Required to work an average of / no more than 48 hours a week, unless they specifically opt-out.
- Entitled to 5.6 weeks' paid time off per year.
- Allowed 1 consecutive hours' rest per 24-hour period.
- Entitled to a 20-minute rest break (for working days longer than six hours).
- Meant to have 11 hours of rest between working days. (e.g. Say they finish work at 8pm, they wouldn't work again until 7am the next day.)
- Given a minimum of one day off per week.
- Not allowed to work more than eight hours - for night shifts - in any 24-hour period.
- Restricted to 8-hours per day and 40-hours per week if they are aged 16-18.
Why do we have Working Time Regulations?
This legislation was introduced due to:
- Health and safety requirements - to defer people from working for dangerously long periods of time; as well as
- Maintaining a healthy work-life balance.
What do the Working Time Regulations cover?
Now with everything, there are always exceptions to the rules. The Regulations apply to all part-time and full-time workers, including most agency workers and freelancers.
Some categories of work or job are exempt from the Regulations, including armed forces and police, emergency services staff when dealing with an emergency and those whose “working time is not measured or pre-determined” which can include senior managers and people employed by family members.
The 48-hour working week
In the UK, unlike other EU Member states, we allow workers to opt out of the 48 hour working week limit. Quite often than not, the employer and or employees think that opting out means they are opting out of the whole regulation. This is not the case they are only opting out of the total hours limit which is currently set at 48 hours.
Working Time Regulations and holiday
The other area that tends to cause confusion is the Working Time Regulation in relation to holiday. There are some common mistakes that employers make:
1. Calculating holiday entitlements for part-time employees
Calculating holiday entitlement for part time workers can be difficult. I was asked 5 times in the same week how to do it! It can get difficult but there are holiday calculators available for you to do the hard work for you.
2. Failure to pay outstanding holiday pay for a leaver
Whatever reason an employee leaves your business they are entitled to holiday pay accrued to their last day. Even if you dismiss them they are entitled to this. Again the calculation of this can be quite tricky but using HR software can help you ensure you are keeping legal.
3. Holiday pay for zero hours
I have seen a lot of cases and especially small businesses who just don't understand that they need to pay holiday pay for those on a zero-hours contract. Most of the time it is because they don't know how to calculate it. The rule is for every hour an employee works they are entitled to 12.05% of holiday accrual. You don't need to count on your fingers or toes systems such as RotaCloud will actually calculate this for you. Failing that a good old fashioned excel spreadsheet using a SUM works just as well.
4. Holiday accrual for overtime hours
In August 2017, the Employment Tribunal favoured an employee who had accrued holiday pay for overtime. This is an important lesson for any small business owner, which highlights why recording additional hours is vital.
It also demonstrates the benefits of switching your paperwork and employee details onto a cloud-based HR software. Our Breathe package, for example, helps HR managers and administrators record any additional hours or accrual of holiday pay.
5. Claims for unpaid holiday at the end of the year
The regulations state that all employees should receive 5.6-weeks holiday a year. We all know those employees who never manage their time and fail to take holidays. How can small businesses protect themselves from having to pay that out?
Ensure you have a policy and procedure for managing holidays which should include
- Regular written reminders if holidays are not being used.
- The ability to track when holidays are approved or denied.
- The ability to serve notice to an employee to make them take holiday.
Our holiday system allows users and employees to take control of holiday requests and bookings. By allowing each employee direct and instant calendar access, your team can check availability for themselves. All that's left is for the HR manager to approve and voila. Bonne vacance.
With the removal of the employment tribunal fees in 2017, it is important that small businesses get expert advice in all areas of employment law.
As the Working Time Regulations were last reviewed in 2003, we're due for an overhaul. Watch this space.