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Original poster

Dodgy / illegal? Employer wants us to take holiday now - or fake it

29 replies

Edgyandstressed · 03/04/2020 11:38

Officially, my employer is asking us take to the bulk of our holiday time in the first half of this year. This will improve reported profitability when revenues return (hopefully) in the second half.

Unofficially, all managers are asking staff to book time off in H1 in our payroll system but have an informal log of when people actually take leave. Eg: officially book time off in May, but actually take it in July. This is being suggested for people like me who have school-age kids.

What should I do? My employer is not guaranteeing future employment, nor if they will stand by their generous enhanced redundancy package. In the worst case, I could lose my job with no payment for accrued holiday time and statutory redundancy which my family can't live on.

OP posts:
Tatty101 · 03/04/2020 11:42

Absolutely not! Do you really think they'd pay it out if you moved jobs/they went under etc?

Original poster
Edgyandstressed · 03/04/2020 11:47

It is all about trust - and huge pressure to be a good corporate citizen. But if you refuse to play along, it might impact employment prospects. Damned if you, damned if you don't. Not sure how long i can dodge this.

OP posts:
AnotherEmma · 03/04/2020 12:12

Are you a trade union member? If not you should join now. They don't usually help with existing issues but if there is an issue in future (which it seems you're worried about) they'll be able to advise on that.

Are you happy to actually take annual leave before the end of June? If they want it on their records and you want the records to reflect the leave you actually take, why not do that? I guess you'll want to save some leave for the second half of the year but you could compromise and take a decent chunk sooner rather than later.

flowery · 03/04/2020 14:35

I’m not sure I’m following. How does whether you’re in work or taking annual leave affect their profitability?

Original poster
Edgyandstressed · 03/04/2020 19:54

It's about costs on the balance sheet: Holidays are a cost - if employees take holiday in 1H20, it reduces costs in 2H20 which improves the company's overall financial picture. It could strengthen investor confidence in the company's ability to rebound after dramatic loss of revenues and share value due to COVID-19 in 1H20.

OP posts:
ScouseMar · 03/04/2020 19:56

But holidays do not appear on a balance sheet as a cost? This makes no sense?

prh47bridge · 04/04/2020 00:03

Agree with other posters. Holidays are not a cost that appears in the accounts anywhere. It makes absolutely no difference to the company's costs whether you take your holiday now or later. You are paid the same whether you are on holiday or in work, so the cost to the business is the same. The only difference is that you aren't doing any work while you are on holiday.

Original poster
Edgyandstressed · 04/04/2020 09:24

Below is what employer claims - I am not an accountant to judge veracity:

"As some know, but others may not realise, in accounting and financial terms, vacation and holiday allowances are a cost to the business. Whether it is allocated for a given year, earned over a period or deferred, vacation time accrues as a charge against our profit until it is used.

For this reason, to help further flatten the curve of our costs in 2020, we are asking everyone to accelerate vacation time and use up as much allowance as possible before 30 June, with the target for at least 75% of all allocated, earned and deferred holiday to be used by the middle of the year."

OP posts:
prh47bridge · 04/04/2020 11:44

In theory, under FRS 102 28.3 they could accrue the cost of holiday earned but not taken as an expense. However, most businesses don't do this as it isn't material, i.e. the amount of money involved isn't significant. If your employer is accruing the cost in their accounts they could indeed improve their figures for H2 by getting everyone to take their holiday in H1. What they can't do is get you to pretend to take your holiday in H1 but actually take it in H2. That is falsifying the accounts.

thecapitalsunited · 04/04/2020 12:16

We’ve also been told that vacation days are a liability on the books and to take as many of them as possible in the first half of the year. We’ve not been told to pretend that we’ve taken them though because as others have mentioned that would be false accounting.

Maybe it makes a difference if your company is spread over several countries? Perhaps some countries require businesses to hold vacation days as a liability on the books? Not sure I don’t know enough about it.

Irial · 04/04/2020 12:18

I've not seen this before, but if you book holiday and dont take it then technically you lose it

Also its fraud "That is falsifying the accounts." as @prh47bridge says above

TheTeenageYears · 04/04/2020 13:44

It becomes a bigger liability for companies if they end up making people redundant as they then need to pay out holiday in cash and at this point in time there are very few companies of any size who will come out of Covid-19 unscathed . Taking holiday before it's actually accrued is a problem for employees - if you are made redundant you would end up owing the company money, likewise if you choose to leave. I wouldn't recommend anyone take holiday they haven't yet accrued.

MizZan · 05/04/2020 10:45

OP, I believe we may work for the same employer. However in my team we have not been told to book the 75% of annual holiday now and take it later; we've been told we have to take it now.

As far as I can make out, the only real explanation is they are trying to avoid having to pay out unused holiday to people when they make them redundant, as is very likely to happen later this year given the nature of the company's business means it's certainly going to take a heavy financial hit this year. And on top of that, as @TheTeenageYears says, since they are forcing us to take unaccrued holiday, they are also putting the employees in the position of owing the company money if said employee is let go.

The fact this hasn't been mentioned at all in the comms seems very dishonest. And I'm feeling guilty too about not bringing this up with my team. But like you, I'm afraid raising my hand about it is going to put me right in the firing line for being a 'bad corporate citizen', and right at the top of the potential redundancies list.

On top of that, the part of the business I work in hasn't really slowed down, so we're having to scramble to postpone work because of this. In the meantime my (child-free) boss is acting like the company is doing all of us some kind of favour. On the one hand I appreciate we are lucky to still have jobs, on the other hand I would like to know the full implications of this request.

Not sure what to do. No union and more or less non-existent HR department. Do they actually have the right to ask us to take unaccrued holiday? If that's not been voluntary on the employee's part, do we have the right to demand they cancel that 'debt' if we're made redundant before the holiday taken is actually accrued?

prh47bridge · 05/04/2020 11:44

Do they actually have the right to ask us to take unaccrued holiday?

I'm afraid they do. Your employer is entitled to tell you when to take your holiday provided they give you two days notice for every day they want you to take. So if they want you to take 9 days they must give you 18 days notice.

If that's not been voluntary on the employee's part, do we have the right to demand they cancel that 'debt' if we're made redundant before the holiday taken is actually accrued?

No, I'm afraid not.

MizZan · 06/04/2020 14:55

Thanks, good to know, though disappointing the organisation hasn't been up-front about it. On top of this my division has just announced a reorganisation and I've been asked to attend a meeting with HR, so needless to say I won't be rushing at this point to book unaccrued holiday at the company's request.

burnoutbabe · 06/04/2020 15:00

that is a very consciountous company who books that accounting accrual each quarter. I can only assume they have to report results publicly each quarter? (as else you'd just do it at year end)

Also, must people understand its just an accounting concept and could explain to analysts that the holiday pay is very high due to XYZ. Seems easier to resolve in that way than making thousands of people track holiday off books!

Original poster
Edgyandstressed · 07/04/2020 09:52

@MizZan - my sympathies for the additional stress. Let us know what HR is now saying. So much for loyalty and service when the going gets tough.

OP posts:
MizZan · 07/04/2020 18:00

Thanks @edgyandstressed (great name btw!).

So, a number of us are being put 'at risk' due to restructuring, with a very accelerated timetable - first consultation this week, final consultation and confirmation of dismissal if no suitable alternative role is available will be in 10-12 days. Line manager and HR refused to confirm to me how many people are being put at risk, meaning it could be more or fewer than 20. I'm fairly sure it's more, but quite possibly not all in the UK. Are they allowed to withhold this info?

There are a large number of new roles being created, which any of us can interview for, but no guarantee of getting any of them and I suspect those of us who haven't been pointed to one of these in advance will not be seriously considered.

And the timing is such that if someone in an existing role who isn't 'at risk' applies for and gets one of these new roles, those of us in the 'at risk' pool won't know about that outcome in time to apply for the role that person has vacated.

On top of that, the justification for removing my role is that a new role will be created at a slightly more senior level, to manage the team I currently manage (which will have 2 fewer people) plus a few others who work in the same area on the same things as us. So in total, basically the same job but with 2-3 extra people to manage, plus an extra product in the same area (which I've already been heavily involved in planning for). It's impossible to see it as anything other than being given the push.

Welcome any advice. It is what it is, but it's horrific timing on the company's part, considering how little notice is being given and that the chance of any of us getting new roles elsewhere is zero. And considering all the lip service paid to preserving people's jobs from senior management, which I faithfully parroted down to my own team...guess I should have known better.

prh47bridge · 07/04/2020 19:53

Are they allowed to withhold this info

Yes. However, if it is more than 20 they must have a consultation with a union rep or an elected employee rep.

On top of that, the justification for removing my role is that a new role will be created at a slightly more senior level, to manage the team I currently manage (which will have 2 fewer people) plus a few others who work in the same area on the same things as us

That doesn't sound lie a genuine redundancy. You may have a case for unfair dismissal if you have been there 2 years or more.

MizZan · 07/04/2020 22:00

Thanks for the reply. I've been there more than 2 years. I can't imagine I'll be seriously considered for the new 'more senior' role, as my line manager has had every opportunity to promote me into it since we acquired the company he worked for previously some months ago, and clearly he's just got someone else in mind. I guess I have to go through the motions of applying, but realistically there's no way we can work together after going through this process, as I'm sure he's well aware. If I could claim unfair dismissal I'd certainly do so, though I guess that has to wait until they actually don't give me a job (10 days from now)?.

The whole thing stinks, and in the meantime I'm sitting here still trying to motivate myself to meet client deadlines and deliver. I feel like letting as many colleagues know as possible, is there any reason not to do so? The outcome's clearly predetermined.

prh47bridge · 08/04/2020 00:21

You don't have a claim for unfair dismissal unless they actually dismiss you or make you redundant.

You believe the outcome is predetermined but you don't know that for certain. If you start telling colleagues what you think is going on your employer may be able to dismiss you without giving you a claim for unfair dismissal.

AprilFloundering · 08/04/2020 00:32

They're asking all of you to commit fraud.

Is the request actually in writing?

TheTeenageYears · 08/04/2020 07:55

@MizZan while you wait to learn your fate look into barristers. A one hour appointment can be absolutely invaluable in these kinds of situations. A letter to the company from them shows you are not just going to roll over. A couple of hundred pounds can go a really long way in securing a better redundancy package.

prh47bridge · 08/04/2020 09:32

while you wait to learn your fate look into barristers

Nothing wrong with barristers but personally, in this situation, I would look for a solicitor who specialises in employment law.

A letter to the company from them shows you are not just going to roll over

I would not do that at this stage. Right now MizZan is assuming that she isn't going to get the new role. She may be right but it may just be that the company is going through a process with the intention of giving her this job. A letter from a lawyer at this stage is unlikely to help and could make things much worse.

TheTeenageYears · 08/04/2020 09:41

@prh47bridge there are also barristers who specialise in employment law. Many years ago when my DH was being made redundant he was advised to go down this route and it was worth it's weight in gold. I also said to look into until the OP knew what the situation was, not to get a letter sent now. It sounds like the company are looking to act quickly so spending a little bit of time on research now could pay dividends later or it could all be done and dusted before OP has time to do anything.