Most HR professionals are accustomed to dealing with years where bank holidays fall in roughly the same pattern. Occasionally, however, the calendar throws up an anomaly that creates unexpected employment law risks.
Between 1 April 2026 and 31 March 2027, employers operating a holiday year that runs from April to March will find that ten bank holidays fall within a single leave year. This is due entirely to the timing of Easter. Both the Good Friday and Easter Monday bank holidays fall within the holiday year in both 2026 and 2027, creating two additional bank holidays compared with what many employers would regard as a ‘normal’ year.
While this may seem like a payroll or workforce planning issue, it has the potential to create contractual and compliance risks for employers who fail to review their annual leave arrangements.
This article covers the 2026/2027 holiday year, but there are also knock on effects for the 2027/2028 holiday year, during which there will only be 6 bank holidays. We’ll look at the issues surrounding that in more detail a follow up article later this week.
A word for the Scots
Bank holidays in Scotland are slightly different to those in England & Wales. In a ‘normal’ year, the Scots observe nine bank holidays. Unlike England & Wales, they do not have Easter Monday as a bank holiday but they do have St Andrew’s Day and 2nd January as standard. The fact that Easter Monday is not a bank holiday in Scotland means that the timing of Easter only operates to add one additional bank holiday for 2026/27 (Good Friday). However, as Scotland qualified for their first World Cup in 28 years, an additional bank holiday (15th June) was declared in celebration – bringing Scotland back onto a par with England with two extra bank holidays in the 2026/27 holiday year. The total for Scotland for the 1 April 2026 – 31 March 2027 holiday year is, therefore, a whopping 11 bank holidays.
The importance of contract wording
Whether employees are entitled to benefit from these additional bank holidays depends entirely on how annual leave is expressed in their contracts of employment.
For example, where a contract provides for “20 days’ annual leave plus bank holidays”, the employee will ordinarily be entitled to all bank holidays that fall within the relevant holiday year. In 2026-2027, for a holiday year that runs 1 April-31 March, that means ten bank holidays (for England & Wales) rather than the more typical eight. If the employer requires employees to work on one or more of those bank holidays, they should ensure that an equivalent period of time off in lieu is provided or that the contractual arrangements permit an alternative approach.
In contrast, where a contract provides for “28 days’ annual leave inclusive of bank holidays”, there is unlikely to be any additional entitlement. The employee’s total annual leave remains fixed at 28 days regardless of how many bank holidays fall within the leave year.
The difference between these two forms of wording could result in a two-day disparity in entitlement during the 2026-2027 holiday year.
Why doing nothing creates risk
From 6th April 2026, employers must keep records of annual leave and holiday pay for six years. Increased scrutiny of compliance (by the newly established Fair Work Agency) means that simply ‘hiding’ from these additional bank holidays and doing nothing is not a sensible option.
Where contracts provide annual leave “plus bank holidays”, employers should expect holiday records to reflect that the employee had the opportunity to take all bank holidays falling within the relevant leave year. If those additional days are simply ignored, it may become difficult to evidence compliance with contractual obligations.
An employer who fails to honour a contractual entitlement to bank holidays may face claims for unlawful deductions from wages. Where employees have been denied paid leave to which they were contractually entitled, the value of that lost leave is recoverable through an employment tribunal claim. Depending on the circumstances, employees may also seek to pursue grievances or raise concerns collectively, creating avoidable employee relations issues.
Practical steps for HR
The good news is that the issue is easily identified and managed in advance.
HR teams should:
- Review the organisation’s holiday year.
- Audit annual leave clauses across the workforce.
- Identify employees whose entitlement is expressed as a number of days “plus bank holidays”.
- Consider how operational requirements will be managed where additional bank holidays arise.
- Ensure holiday records accurately reflect contractual entitlements and leave taken.
As with many annual leave issues, the legal risk is not created by the calendar itself but by a failure to align contractual promises with workplace practice. A simple contractual audit now could prevent disputes, grievances and potential tribunal claims later.