Holiday Carry Over Rules: What You Need to Get Right
Posted on 2nd May 2025 at 10:36
Holiday entitlement can be a confusing at times, especially when someone hasn’t used all their days by the end of the year. So what happens when it comes to carrying over unused statutory annual leave? Let’s break it down.
The Basics
Every employee in the UK is entitled to 5.6 weeks of paid holiday per year. That’s the legal minimum under the Working Time Regulations 1998 (WTR). This entitlement is made up of two parts:
4 weeks of core leave, which comes from EU law (specifically Directive 2003/88/EC) and is implemented through Regulation 13 of the WTR
1.6 additional weeks, provided under Regulation 13A, which covers UK-specific holidays like bank holidays
Generally, the law says that the core 4 weeks of leave can’t be carried over into the next holiday year. It’s a use it or lose it rule. However, the additional 1.6 weeks can be carried over for up to 12 months, if your employment contract or policy allows for it.
When Can Statutory Holiday Be Carried Over?
Changes to the law last year clarified when employers must allow unused holiday to roll over. These changes are aimed at making sure employees don’t lose their statutory leave in situations beyond their control. Here's when carry over is legally required:
Family Leave
If an employee has been on maternity leave or any other type of family-related leave (such as adoption or shared parental leave) and they haven’t been able to take their holiday, they are entitled to carry over the full 5.6 weeks into the next holiday year.
Long Term Sickness
If someone has been off sick and unable to take their leave, they can carry over their 4 weeks of core EU leave. They then have 18 months from the end of the leave year in which the leave was accrued to take it.
Employer Failure
If an employee misses out on their leave because the employer didn’t do their part — for example, if you:
Didn’t inform them of their right to paid holiday
Didn’t give them a genuine opportunity to take it
Failed to explain that leave would be lost if not used
Then the employee is allowed to carry forward their 4 weeks of core entitlement, and in these cases, there is no time limit on how long that leave can be carried over. It continues until the issue is resolved.
What About Irregular or Part Year Workers?
The same legal protections apply to employees who work irregular hours or only part of the year. This group is covered by recent reforms designed to make holiday rights fairer across different working patterns.
If they miss out on taking their leave due to sickness, family leave, or employer oversight, they too can carry over their statutory holiday just like full-time employees.
What You Should Do
If you’re running a business or you have responsibility for managing holiday in your business, the best thing you can do is stay on top of holiday tracking. Consider things such as:
Keep records of leave taken and remaining for every employee
Remind your teams regularly about their holiday entitlement and deadlines
Encourage people to take their time off and not to leave it all to the end of the year
Stipulate any holiday rules in your employment contract
Getting this right helps avoid disputes and keeps your business compliant with the law. Plus, regular time off helps your team stay fresh and productive.
Need help updating your holiday policy to make managing holiday easier? That’s where we come in. Let’s talk.
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