You have an employee who has booked holiday and either just before they travel or whilst they’re away they are ill. We share advice and tips on how to manage annual leave and sickness overlap – what are the rules?


When prearranged holiday overlaps with sick leave, employees should let their employer know as soon as reasonably practical. As a result of complying with the company’s notification procedure then they are allowed to take their holiday at another time or the days lost through sickness (if this only affected part of the holiday period).

If they remain sick until the end of that annual leave year, they can reschedule their holiday in the following year. If an employee converts holiday leave to sick leave, they should expect to receive any sick pay due only because they are unfit to do the job during that period.

When an employee is on sick leave but wants to take a holiday during their absence

The Working Time Regulations (WTR) allow employees to do this. Furthermore, employees continue to build up their holiday entitlements while they are off sick, but don’t have to take their holiday during that time. They can carry it over to the next year if they haven’t been able to take holiday while sick.

Long term absence

This is why it is critical for employers to ensure that they effectively manage those employees absent through long term sickness. Many employers believe that as they’re only receiving Statutory Sick Pay (SSP) then there is no cost to their business and so they don’t need to deal with the absence which is clearly not the case.

And another thing…

Another thing to bear in mind is that when an employee who has been off long term sick and decides to leave their employer, they will be entitled to be paid in lieu of any holiday entitlement due, if their absence from work prevented them from taking holidays.

Are you prepared?

People matters can be daunting, particularly around sickness absence, annual leave and payroll. Getting and, importantly, remaining legally compliant and consistent is resource-intensive. Whether you are a small, medium or large company, you all need an HR solution. Avoid shutting the gate after the horse has bolted. At MAD-HR we are all too aware that businesses can get locked into costly HR solutions. While we offer ad-hoc and strategic consultancy, we also offer a subscription-based online HR portal. It holds over 1000 documents, templates and contracts as well as online learning guides and advice. We keep it all up to date and you can access it whenever you need. We know people like to have a human in human resources sometimes, so the Online HR Toolkit doesn’t stop you from calling us. Check out its features and benefits and then take advantage of a FREE Toolkit demo to see how it can fit into your business.

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