Hello
I am new to the Forum and this is my first post so here goes....
I am after some advice please.
In the last 4 years my company has grown significantly. We have a new CEO on board who is forward thinking and wants to reward employees so my first challenge is to research what other companies offer in terms of holiday entitlement.
We currently offer new employees 23 days. We shutdown over the Christmas period and staff are required to keep 3 days to cover this.
We do have staff on legacy contracts which offer 25 days holiday, but again they are required to keep 3 days back for Christmas.
There is a clause in our T's and C's that after 5 years service your holiday entitlement will increase to 25 days. Not very helpful for those already on 25 days.
So, what we are proposing is a flat rate of 26 days for everyone (to include the 3 day Christmas shutdown) with a 2 day loyalty bonus in the years you hit 5 and 10.
I would be interested to hear what other companies offer and whether this proposal is fair?
Thank you in advance.
Barbara
Replies
Hi Barbara, we offer 21days then upto 3 days via salary sacrifice and upto a further 5days after 2 years service, for example 2years + service extra day, 3yrs service 2extra days.
Hope this helps
Hi Louise
Yes that is helpful.
Thank you.
Barbara
Hi Barbara
Great post ! holidays can be a bit of a minefield and are contextual in terms of number of days and time off.
Such arrangements are common, but may be indirectly discriminatory on grounds of age and/or sex. In either case, the requirements on employers to objectively justify such practices are less onerous than in most cases of indirect discrimination.
Age discrimination
The EqA 2010 prohibits age discrimination in employment. Among other things, an employer must not (without justification) discriminate (directly or indirectly) against an employee because of age as regards their terms of employment or by subjecting them to any other detriment. Few employers are likely to discriminate directly because of age in the holiday terms they offer employees. However, there may be indirect discrimination if an employer increases holiday entitlement for longer serving employees. If an employee's contract provides that holiday entitlement will increase after ten years' service, for example, this may be indirectly discriminatory because younger employees are much less likely than older employees to have ten years' service. The longer the service required, the greater the likelihood that younger employees will be disadvantaged.
Where an employer's provision, criterion or practice puts those in a particular age group at a particular disadvantage, the employer must generally show that the provision is objectively justified (that is, the provision is a proportionate means of achieving a legitimate aim) to avoid a finding of indirect discrimination. This is an onerous burden for employers.
However, Parliament took the view that the use of length of service as a criterion in awarding benefits to employees is generally beneficial, even if it disadvantages younger employees, and that employers should not be required to objectively justify this in all cases. It therefore created exceptions providing that an increase in holiday entitlement (or other benefits) based on length of service is not unlawful under the EqA 2010 age discrimination provisions where:
The length-of-service requirement is five years or fewer (whether that be five years at a particular grade or five years in total with the employer)
The service requirement is more than five years, but it reasonably appears to the employer that it "fulfils a business need of [the] undertaking (for example, by encouraging the loyalty or motivation, or rewarding the experience, of some or all of [its] workers)" Although this is similar to a justification test, it is thought to be much more employer-friendly than the usual "objective" test, for two reasons:
there is no need for the employer to prove that the length of service criteria actually achieves its business aim, merely that there are reasonable grounds for believing that it does; and
there is no "proportionality" test, so the employer need not show that the discriminatory effect of the length-of-service criterion is outweighed by the business need it serves, or that there is no less discriminatory way to serve that need.
The result is that employers may increase worker's holiday entitlements on the basis of length of service (of five years or fewer) and/or may increase holiday entitlement after more than five years' service where they reasonably believe that there is some business benefit (such as rewarding loyalty or experience).
I think it could be worth asking the workforce what benefits they really value, you could also consider buying and selling of holidays given you provide above the statutory minimum.
I hope the above helps
Sarah
Hi Barbara,
I'm in a similar situation to you at the moment. In terms of overhauling our holiday entitlement but needing to make it fair for everyone.
We have always offered 20 days, 3 of which must be taken during our Christmas shut down. About 5 years ago we started offering length of service increases- 1 extra day for 5 years and 2 days for 10 (plus financial rewards). However now we want to increase our basic entitlement, potentially to 22 days, with the 5 and 10 year increases still in place, but that means that new employees have the potential to increase to 25 days, and existing employees only to 23. So do we automatically give all staff an increase of 2 days to bring them in line with new staff? I think that's what we'll do.
I don't know about legacy contracts but your proposal seems fair to me. Good luck with it.
Sarah, your reply is interesting- I didn't realise there were such considerations over length of service rewards. We currently offer a 10 year reward, and I think this can be justified in our position as working in the construction industry (lift installation) our site personnel in particular have very specific skill-sets and we aim to promote in-house (and do so fairly frequently) by focusing on increasing their skills, knowledge and experience during their employment with us. So it's important to us to reward their loyalty and increased knowledge and skills.
Best regards,
Chrissy
Hi Sarah,
Thank you for your detailed response. You have definitely given me a steer in the right direction.
Kind regards,
Barbara