Annual leave during notice period

[Ellypoo]

Hi
Please can anyone ([flowery]?) help me please. We have a member of staff who is leaving, and wants to finish before his notice period ends. We have agreed to PILON, but want to use his accrued annual leave as part of this period. He wants proof that we can ask him to use his accrued leave as part of the notice period (that he doesn't want to work). He is being made redundant, if that makes any difference, and has requested to finish 3 weeks before the end of his notice period, but I think he wants to be paid the 9 days annual leave that he has accrued as well as being paid the PILON and stat redundancy pay.

I have asked for legal advice to make sure that I was correct that we could ask him to use his leave at a specific time (we can because we have at least twice the notice as the number of days to take) - but now he wants the actual guidance which states that leave can be taken during a notice period.

Can anyone help please?

[Ellypoo]

Oops - that should be flowery!!! Sorry

[flowery]

There isn't actual guidance, because what he is claiming is that there is an exception. You know and can prove that you can require him to take annual leave at any time provided you give the right notice. He is claiming there is an exception to that when it comes to notice periods. If the law said employers can specify leave unless it is during a notice period, all the legal guidance would refer to that exception. Therefore, it doesn't exist.

Btw, you can't PILON and specify that he takes holiday at the same time. What you need to do is place him on annual leave for the first 9 days of his notice period, then terminate at that point and pay in lieu of the remainder of his notice period.

[Ellypoo]

Thanks so much flowery - that is actually what I have specified in the letter - his employment ends after the annual leave, and he is paid PILON after that until the notice period ends.

That's really helpful - thank you!

[LIZS]

are you not technically still employed during PILON ?

[flowery]

No LIZS. Payment in lieu of notice means your employment is ending immediately and you are being paid a lump sum instead of staying employed for whatever your notice period is. If you're still employed but not being required to come into work you are on garden leave.

[LIZS]

ah ok . So if you are given PILON you can be reemployed/sign on straight away but with garden leave you have to wait ?

[flowery]

Yes, basically. :)

[atticusclaw]

Flowery is right but unless you have a contractual clause stating that you can require him to take leave during his notice period you will have to give him more than the nine days as partial notice. You will have to give him 18 days notice of the fact that you need him to use his nine days i.e. you will require him to work his notice for 27 days. Then you pay him in lieu of the remainder. The problem is that he will then accrue another 2 days(ish) of annual leave. This DOESNT apply if you have the clause entitling you to require that the leave is taken during the notice period.

This is why most employers just take the benefit of being able to pilon him (he doesn't continue to accrue leave) and he goes immediately plus, if he doesn't have a pilon clause in his contract the payment becomes compensation rather than a payment under the contract and you don't have to hand over the tax and NI element to HMRC and can retain this and the employers NIC in the business.

[Ellypoo]

Atticus - I had calculated the leave up to the end of the notice period, and we have the 18 days notice before he wants to leave, so I think we are fine.

Thanks for all the advice

[atticusclaw]

remember he doesn't continue to accrue leave once you've piloned him.