Encouraging Employees to Take Annual Leave

As the holiday season approaches, many employees still find themselves sitting on a backlog of unused annual leave, and for employers, this can lead to a frantic end-of-year rush, poor planning, and burned-out teams.

But it doesn’t have to be that way.

Creating a workplace culture that supports and encourages employees to take annual leave is not only a legal responsibility, but also a strategic move for healthier, more productive teams.

In this post, we’ll explore:

• Why employees avoid taking holidays
• The legal entitlements around annual leave in the UK
• The risks of unused holidays
• How to foster a culture of rest and reset in your business
• What you, as an employer, can do to encourage time off

Legal Entitlement: A Quick Refresher

In the UK, employees are legally entitled to a minimum of 5.6 weeks (or 28 days) of paid annual leave each year if they work a standard 5-day week. This includes bank holidays.

Here’s how it breaks down:

Full-time employees: 28 days including bank holidays.

Part-time workers: Holiday is calculated pro-rata.

• Example: If an employee works 3 days per week, they are entitled to 16.8 days of paid holiday (3 x 5.6).

Capped allowance: Statutory holiday entitlement is capped at 28 days, regardless of how many days an employee works.

Employers must also pay regular wages during time off, based on average earnings, shifts, or set contractual agreements.

Why Employees Don’t Take Their Holidays

Although most employees can take holidays, many choose not to. Why?

• Fear of falling behind on work
• Worried about perception – especially if aiming for a promotion or pay rise
• Staff shortages – feeling “guilty” about leaving colleagues to cover
• Unclear policies – not knowing how or when they can book

This can lead to employees rushing to use up their holiday entitlement towards the end of the holiday year, creating scheduling nightmares and unnecessary stress for everyone.

The Risks of Not Encouraging Employees to Take Annual Leave

The purpose of annual leave is to allow employees to rest, recharge, and return to work with renewed energy and focus. When employees skip breaks or work while on holiday, it undermines their wellbeing, and their business.

Consequences of unused or ineffective holidays:

• Increased stress and burnout
• Higher sickness and absence rates
• Lower morale and engagement
• Presenteeism (physically present, mentally checked out)
• Reduced productivity and team performance

How Employers Can Encourage Employees to Take Annual Leave

If your team is hoarding holiday days or skipping breaks, there’s a lot you can do to shift the culture and make rest a priority.

Encourage Mental Health and Wellbeing

Annual leave isn’t just about beach holidays. It’s about protecting mental health and giving people a chance to reset.

Combine your holiday encouragement strategy with broader wellbeing initiatives like:

• Employee Assistance Programs (EAPs)
• Mental Health First Aid Training
• Wellbeing days or company-wide breaks
• Flexible working policies

Can You Pay in Lieu of Leave?

No, you can’t pay employees instead of letting them take holiday, unless they’re leaving your company. Statutory holiday must be taken as time off. This is a legal requirement, and failure to comply could result in penalties or claims.

Final Tip: Start Early

Encouraging employees to space out their leave across the year prevents the common “End of Year Panic” when everyone tries to book time off at once.

• Use internal communications to:
• Share friendly reminders about booking leave
• Highlight how much time each employee has remaining
• Offer incentives or rewards for booking early

Your Role in Encouraging Employees to Take Annual Leave

Encouraging employees to take annual leave isn’t just about compliance, it’s about building a culture of care, balance, and sustainability in your workplace.

At Park City Consulting, we help businesses like yours stay compliant, stress-free, and supportive, through expert HR advice, policies, wellbeing programs, and ongoing HR helpline support.

Let’s make sure your team ends the year well-rested and ready for what’s next. Were here to help you with encouraging employees to take annual leave. For more information, visit our website to explore our holiday entitlement support.