Bank Holidays: What Small Business Owners Need to Know

Bank holidays might feel like a welcome break for many, but if you’re running a small business, they can raise a few tricky questions. Who gets the day off? Should you pay extra? What about part-timers?

Here’s a friendly, no-fuss breakdown of what you need to know – and what you should be including in your employment contracts.

1. How much holiday are your team entitled to?

Let’s start with the basics. In the UK, employees are entitled to 5.6 weeks of paid holiday per year. For someone working a standard five-day week, that works out as 28 days.

Now here’s where it gets a bit confusing: those 28 days can include bank holidays – but they don’t have to. It’s completely up to you, as the employer, how you structure it. The key thing is to make it crystal clear in the contract.

For example:

• You could offer 28 days including bank holidays, or

• 20 days plus the usual 8 bank holidays in England and Wales

Both are totally fine – as long as it’s written down and everyone knows where they stand.

2. Bank holidays aren’t an automatic day off

A lot of people assume they’re entitled to bank holidays off, but that’s not actually the case.

There’s no legal right to take them off unless it’s specified in the contract.

Some sectors – like hospitality, retail, and healthcare – often need staff to work public holidays. If that’s the case in your business, just make sure it’s clearly laid out in the employment contract or staff handbook.

The golden rule? Be upfront and consistent. Nobody likes surprise shifts.

3. Do you have to pay extra for working a bank holiday?

Again, there’s a common myth that staff must be paid more for working on a bank holiday.

Legally, you don’t have to pay extra – as long as their overall holiday entitlement is met.

That said, many businesses do offer time-and-a-half or double pay as a way to say thanks – especially if the day’s likely to be busy. It’s a great way to keep morale up and show a bit of appreciation.

4. Don’t forget your part-time team

It’s easy to overlook part-time employees when it comes to bank holidays – especially if they don’t usually work on the day it falls. But to stay fair (and legal), you need to pro-rate their holiday entitlement, including bank holidays.

This helps avoid any claims of unfair treatment, and ensures everyone gets a fair deal – regardless of the days they work.

A quick example: if someone works 3 days a week, they’re entitled to 3/5ths of the full-time holiday allowance, including a proportion of bank holidays.

Top tip: Use an online calculator or HR software like Breathe to help work this out if you’re unsure – or ask for advice.If you choose to offer enhanced pay on bank holidays, just make sure it’s written into your contracts or policies, so there’s no confusion.

If you want to try Breathe for 14 days absolutely free drop me a message or use this referral code: https://www.breathehr.com/en-gb/sign-up?hrp=MINERVAHR21

Final thoughts: keep it clear, fair and written down

Bank holidays don’t need to be a headache. The key is to:

• Be clear in your contracts

• Treat everyone fairly (including part-timers)

• Decide what works for your business and your team

• Put your policy in writing so everyone knows where they stand

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Got questions or need a hand reviewing your holiday policies? Get in touch. We always happy to help.

LETS CHAT