The New Legal Landscape for Holiday Records in 2026
As of 6 April 2026, UK employers are now legally required to maintain comprehensive records of annual leave and holiday pay for a minimum of six years. This significant change, introduced through amendments to the Working Time Regulations under the Employment Rights Act, transforms what was previously considered best practice into a hard statutory obligation. For HR teams, the message is clear: if you haven't already overhauled your record-keeping systems, the time to act is now.
The new rules apply across the board. Employers must record all forms of leave, including ordinary statutory leave and any additional contractual leave, as well as holiday entitlement carried forward from one leave year to the next. Critically, the regulations also require detailed documentation of holiday pay calculations — including exactly what earnings have been included or excluded when calculating pay, and any payments made in lieu of leave, such as those arising from carried-over entitlements. This level of granularity is new territory for many organisations, and HR departments must be prepared.
Why This Change Matters More Than You Think
Most organisations already use some form of system to track annual leave — whether that's a spreadsheet, an HR platform, or a time-and-attendance tool. However, this is the first time the law has explicitly required employers to retain detailed records not only of leave taken but of how holiday pay is calculated. These are two very different requirements, and many current systems are not built to handle the second one.
The stakes are high. Failure to maintain adequate records could expose employers to Employment Tribunal claims, particularly those involving underpayments of holiday pay. Since the six-year retention period aligns with the general limitation period for breach of contract and unlawful deduction from wages claims, employers who cannot produce records going back far enough may find themselves unable to defend legacy claims. This is not a theoretical risk — it is a very real compliance liability.
What Records Must HR Now Keep?
To meet the new statutory requirements, HR teams need to ensure their systems can capture and retain the following information for every worker:
- The amount of statutory annual leave entitlement accrued in each leave year, including any pro-rated entitlement for part-year or irregular-hours workers.
- Any additional contractual leave entitlement provided above the statutory minimum.
- All leave actually taken, including the dates and duration of each period of absence.
- Any leave carried forward into the next leave year, along with the legal basis for that carry-over (for example, carry-over due to long-term sickness absence or family leave).
- The method used to calculate holiday pay for each worker, including the reference period used and which elements of pay were included — such as regular overtime, commission, or shift allowances.
- Any payments made in lieu of unused leave, including the calculation basis for those payments.
Updating Your HR Systems and Policies
The introduction of these new requirements is the ideal prompt for HR teams to conduct a full audit of their existing leave management infrastructure. Many legacy HR platforms were not designed with this level of holiday pay calculation detail in mind. If your current system cannot automatically log and store pay calculation methodology alongside leave records, it may be time to upgrade or supplement it with a more capable solution.
Beyond the technology, HR policies themselves need to be reviewed and updated. Leave policies should clearly set out how holiday pay is calculated for all worker categories, including those on variable hours or with fluctuating pay. Managers who approve and record leave must be briefed on the new requirements. Payroll teams need to work closely with HR to ensure that the data captured during pay runs feeds back into leave records in a compliant and auditable way.
Managing Travel Disruption: A Growing HR Headache
Alongside the record-keeping obligations, HR teams also face a growing operational challenge that sits directly at the intersection of holiday policy and employment law: employees stranded abroad due to travel disruption. As climate-related weather events, airline strikes, and geopolitical instability become increasingly common, the risk of workers being unable to return from annual leave on time is rising sharply.
HR departments need clear, written policies that address what happens when an employee cannot return from holiday as planned due to circumstances beyond their control. Without such a framework, organisations risk inconsistency, disputes, and inadvertent breaches of employment law. Key questions your policy must answer include: Will the additional days of absence be treated as authorised or unauthorised? Will they be paid or unpaid? Can the employee access emergency leave entitlement? What evidence, if any, will the employer require before deciding how to treat the absence?
Building a Consistent Framework for Disruption Scenarios
When travel disruption occurs, each case will inevitably feel different. However, the legal and reputational risks of ad hoc decision-making are considerable. HR teams should establish a clear escalation process so that line managers are not making consequential decisions in isolation. A central point of contact within HR should handle all disruption-related absence notifications, assess each case against the policy, and communicate decisions consistently.
It is also worth reviewing whether your organisation's existing contractual leave provisions — particularly any clauses about unauthorised absence or disciplinary consequences — are proportionate when applied to genuine travel disruption scenarios. Applying a blanket disciplinary approach to an employee stranded due to a volcanic eruption or a nationwide transport strike is unlikely to stand up to scrutiny at an Employment Tribunal, and could cause significant reputational damage.
The Bottom Line for HR in 2026
The combination of new statutory record-keeping duties and the increasing frequency of travel disruption means that holiday compliance has never been a more pressing priority for HR teams. The organisations that will fare best are those that treat this not as a box-ticking exercise but as an opportunity to build genuinely robust, fair, and future-proof leave management frameworks. Start with a full audit of your current systems, update your policies, train your managers, and ensure your payroll and HR functions are working in lockstep. The legal duty is now in force — there is no grace period, and the time to act is today.