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Running a small business can be hard work, and when you employ staff to help you with your business activity, you need to understand employment law. Employment law is an area of law that has many rules and often changes, so it is essential to keep up with these. One of the rules you need to know about are the rules of unpaid leave, as you may be legally required to grant this to your employees if they request it. This article will explain how to navigate unpaid leave for small business owners.
What is Unpaid Leave?
Unpaid leave is when your employee takes time off work and, as a result, is not paid by you. So, it is in addition to the legal minimum entitlement of 5.6 weeks of paid leave per year.
As an employer, there are times when you must allow your employer to take time off work and times when it is your discretion whether to allow it or not. However, it is up to you when you allow time off work whether or not you allow it as paid or unpaid. There are three main types of unpaid leave, being unpaid leave that which:
- you must legally allow;
- you must legally consider; and
- it is your discretion as to whether to allow or not.
When Must I Grant Unpaid Leave?
As an employer, you are legally required to grant your staff unpaid leave if it is for any of the following:
- to allow them to carry out jury service;
- reasonable time off to take part in magistrate duties where they are a magistrate;
- to carry out other personal responsibilities such as a school governor or being a local councillor;
- to spend time with an under 18 if they meet the criteria for this (you will hear people refer to this as ‘parental leave’ with its own rules); and
- for an emergency concerning a dependant (dependant leave), such as an accident at school.
When you are required to allow unpaid leave, the number of days you must grant depends on the reason. For example, for magistrate duty, you must allow a minimum of 13 full days per year or 26 half days.
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When Do I Legally Have to Consider a Request for Unpaid Leave?
When your employee requests unpaid leave, you have a legal duty to consider their request of it is for training or study. This is under the Employment Rights Act 1996, which an employment lawyer can help you navigate. For example, there are specific criteria your employee has to meet to be able to request this. You do not have to allow the request for leave for study and training if it:
- does not benefit your business; or
- prevents you from continuing to meet customer demands.
When is a Request for Unpaid Leave My Discretion?
In terms of the third type of unpaid leave, where it is entirely your discretion whether to grant, examples of the reason for the request include:
- for a career break or sabbatical;
- to improve an employee’s work-life balance;
- doctor’s and dentist appointments;
- to volunteer;
- for compassionate reasons; and
- for a bereavement.
It is essential, however, to be aware that although unpaid leave for doctor’s appointments is at your discretion, this varies for pregnant employees. You legally have to grant them time off for antenatal appointments. Also, although compassionate leave is at your discretion, where it is to grieve a dependent, your employee has a legal right for ‘reasonable’ time off.
If you grant discretionary leave, you naturally choose how many days you allow. However, it is essential to outline your discretionary leave policy so your employees know your rules. Being generous with this policy, such as allowing a lengthy career break after a long time working for you, may help employee retention.
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Key Takeaways
You may choose to or be required to grant your employees unpaid leave in addition to their legal paid leave. For example, if your employee requests it for jury service or to attend to public duties, you must legally grant leave. The amount of time you grant depends on the reason. For public responsibilities, for example, where the time requested is unreasonable, you can refuse the unpaid leave. If your employee requests leave for study or training, you have a legal duty to consider it where they meet the criteria, but do not have to grant it. Your employee may request unpaid time off work for many other reasons. Where it is not one you legally have to grant it for or legally consider, you have the discretion to allow or deny it.
If you need help understanding leave in the UK, LegalVision’s experienced employment lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. So call us today on 0808 196 8584 or visit our membership page.
Frequently Asked Questions
Unpaid leave is when your employee takes time off work without pay in addition to their legal entitlement to paid leave.
As an employer, you do not always have to allow unpaid leave, but there are times when you must allow it or at least consider it. For example, you must at least consider an employee’s request for leave if it is for study or training reasons.
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