Can a parish council approve payment to the Clerk in lieu of annual untaken leave

Question

Like many a parish council Clerk/RFO, I was unable to take anywhere near my annual leave entitlement for the last financial year due to COVID lockdowns. I work part time (70 hours per month) and I am the only employee of the Council. I understand that it would have been possible to carry over the untaken leave into this year's entitlement due to the extraordinary circumstances of COVID, however this would have meant the I could have been on leave for several months during the year, obviously not practical. Would this be classed as a ex-gratia payment and taxable, or something else?? This is not something that has cropped up before under normal circumstances during my seven years in the role.

Answer 1

In light of reading the post again, all the time over and above your 70 hours per month  less normal leave hours would have to be treated as additional owed overtime salary based on your normal hourly rate, subject to the normal deductions. As DavetheClerk and Cottenham Frank rightly say you can't exchange holiday for extra salary unless close to leaving.  But your councillors would have to be  agreeable.  What does your contract of employment say?

Comments

Other than at termination,  you are not allowed to contract out of the minimum holiday entitlement by paying them instead. The statutory provision was designed to give employees paid time away from the work environment and there are sound health and wellbeing reasons for them to have that time. That "time away from the desk/phone" is even more important during lockdown.

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Just read your post again. When you say you were unable to take leave, was this because the council asked you to work  effectively extra hours instead on the basis they felt it would benefit you since couldn't go anywhere, then carry it  over instead after restrictions were eased? This was the assumption I made. As Dave the Clerk and Cottenham Frank point out, you can't trade annual leave for cash unless you are close to retiring.  You can't defer asking  leave just because there is nowhere to go or nothing to do whilst you are off. The council should really have questioned or discussed you holiday plans before the end of the yearly employment cycle. The only option now if legal  might be to see if they agree that the number of hours over and above your 70 per month worked last year can be classed as overtime at standard rate and pay it in lieu and  agree to spread the owed holiday over a long period and for you to lose some of the owed days.

Answer 2

Payment for unused annual leave is only allowed as part of the calculation at the end of your employment. There is no legitimate way of paying for unused leave in continuing employment, even during the pandemic. Covid legislation gave you a right to carry over up to 20 days you were unable to take due to the pandemic, to be taken at any time in the following two years. This exceeds the maximum entitlement under normal circumstances, although many employers offer discretionary holiday entitlements that exceed the statutory maximum.

Answer 3

There is normally a clause that says how many days if any can be carried over and or exceptional circumstances for not being able to take leave.

The lack of taking annual leave should have been picked up during regular 1-2-1 as it is designed to support the health and well-being of an employee