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Two in three employees to 'roll over' annual leave, costing UK businesses £12bn

Abigail Fenton
·2-min read
Annual leave 'roll over' could cost businesses about £12bn. Photo: Gareth Fuller/PA
Annual leave 'roll over' could cost businesses about £12bn. Photo: Gareth Fuller/PA

Two thirds of UK employees plan to carry over at least one day of annual leave into next year, potentially costing businesses about £12bn ($15.5bn), research suggests.

A temporary law was passed by the government back in March allowing workers to “roll over” up to four weeks’ paid holiday.

Over 20 million Brits could end up doing this if all are given permission by their employer, according to analysis by personal finance comparison website Finder.

The research found workers who plan to shift some of their annual leave to next year will roll over an average of 5.11 days, while nearly two in five (37%) intend to roll over more than five days.

READ MORE: Two in five Brits expect pay rise in next year despite COVID-19 induced recession

Full-time employees in the UK make about £117 a day — meaning Brits who don’t take all of their annual leave are essentially working 5.11 days for free, and will be losing out on £598 this year.

Brits will now be able to “even out” this discrepancy next year. In previous years, they would have lost out on this income.

However, businesses will “experience the cost of this new law” during their next annual leave period, when vast numbers of employees could be working less for the same pay, Finder warned.

The study found this could cost businesses across the UK a whopping total of £12bn, if all employers allow their employees who want to roll annual leave over to do so.

READ MORE: Social distancing could cost businesses £5,450 per employee, study finds

Londoners plan to carry over the most days into next year, at about of 7.66. On top of this, four in five (81%) workers in the capital said they plan to take at least one day forward into 2021.

At the other end of the scale, East Anglia residents plan to take the least, at an average of just 3.87 days. This region also has the smallest number of workers planning to take leave forward, at just over two in five (43%).

Millennials plan to carry over the most days, with workers in this generation taking an average of 5.65 days forward, the study found.

Meanwhile, generation Z has the largest amount of workers rolling annual leave over, with more than three quarters (76%) planning to do this.