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Is Annual Leave Accrued When Claiming Permanent Health Insurance From My Employer?

Matt Hall

May 12, 2024

Yes, you usually still build up paid holiday days when you get permanent health insurance (PHI) payments from your job in the UK. PHI is a type of insurance your employer can give you. It pays some of your wages if you can’t work because you’re sick or hurt for a long time. But the exact rules about holiday pay depend on what your work contract and the insurance say. To protect yourself, it’s key to know your rights around taking time off and getting PHI money.

Getting ill or injured is tough, especially if it means you can’t do your job for a while. On top of worrying about your health, you may wonder what happens to your holiday pay. Is annual leave accrued when claiming permanent health insurance from my employer?  What are the laws about this, and what might your contract include? We’ll break down all these details as we look at how PHI affects your yearly leave when you’re employed in the UK.

Key Takeaways:

  • Annual leave typically continues to accrue while claiming PHI from your employer in the UK.
  • Employees are entitled to take their accrued annual leave while on PHI.
  • Employers must allow employees to take their statutory minimum holiday within the current leave year.
  • Reviewing your employment contract and company policies is essential to understanding your specific situation.
  • If you have concerns about your annual leave accrual during PHI, speak with your HR department or consider seeking legal advice.

Understanding Permanent Health Insurance (PHI)

PHI is a type of insurance that your employer can offer you as a benefit. It’s also called income protection insurance. If you get sick or hurt and can’t work for a long time, PHI pays you part of your normal wages. This helps you get by financially while you focus on getting better.

To get PHI payments, you usually have to work for your employer for a certain amount of time first. You also need to show doctor’s notes that prove you’re too ill or injured to do your job. Once your claim is approved, the insurance company will start sending you money. This can be a big relief when you’re dealing with health problems and can’t earn your regular pay.

UK Legal Framework on Annual Leave

In the UK, all workers have the right to at least 5.6 weeks of paid holiday per year. This is the minimum required by law, no matter what kind of job you have. Whether you work full-time, part-time, through an agency, or on a zero-hours contract, you still get this time off.

Your 5.6 weeks of yearly leave is a legal must. Your boss has to let you take it. This is important because everyone needs breaks from work to rest, recharge, and enjoy life outside the job. It’s all about striking a healthy work-life balance.

Some companies give their staff more than 5.6 weeks. They might include extra holiday time in your contract as a perk. But everyone gets at least the legal minimum, which adds up to about 28 days for someone working 5 days a week. It’s a key part of your employment rights in the UK.

Annual Leave Accrual During PHI

When you’re getting PHI payments, you’re still technically employed. You have a job; you just can’t do it right now because of your health. Because of this, your legal right to rack up paid holiday days usually stays the same. The time you spend on PHI counts like normal working time when it comes to earning vacation.

This is backed up by rulings from big courts in Europe. They’ve said that workers keep building up holiday pay while they’re off sick, and this applies to the UK too. It’s an important protection for employees. It means you don’t lose out on time off just because you got ill or injured.

Of course, every situation is a bit different. The details of your PHI insurance and your employment contract matter. But in general, you can expect to keep adding to your holiday balance at the normal pace while you’re on PHI. It’s a way to make sure you’re treated fairly and can take the breaks you need once you’re back in action.

Contractual Annual Leave Considerations

Your work contract might have some special rules about holiday pay and PHI. It’s worth checking the fine print to see what applies to you.

Some employers stick to the legal minimum for paying out vacation days during PHI. Others are more generous and let you accumulate holiday pay faster while you’re claiming insurance money. A lot depends on how the contract is worded.

Your HR department or the person who handles contracts at your job should be able to walk you through the specifics. You can also ask to see a copy of your contract if you don’t have one handy. The key is to understand your particular situation so you know what to expect.

Reviewing your contract is a smart move anytime you’re facing a health issue that might keep you out of work for a while. That way, you can plan ahead, talk to your employer if needed, and make sure you’re getting all the holiday pay you’re owed. A little homework upfront can save you hassle and keep you in the loop on your benefits.

Taking Accrued Leave While on PHI

Just because you’re getting PHI payments doesn’t mean you can’t take a holiday. You’re still allowed to use the vacation days you’ve built up, even while you’re off work for health reasons.

In fact, your employer has to let you take your legal minimum holiday within the current work year if you want to. They can’t deny you this time off just because you’re claiming PHI. It’s your right as an employee.

If you don’t manage to use up all your holiday by the end of the year, special rules kick in. Normally, you might lose the leftover days. But when you’re on long-term sick leave or getting PHI, your employer may have to let you carry some holiday over to the next year. This is so you don’t miss out on your well-earned breaks.

The exact arrangements can vary. Your contract or company policy will spell out how many days you can save for later. But in general, taking holiday while on PHI is allowed and protected. It’s a chance to recharge and enjoy yourself, even during a tough time health-wise.

Employer Responsibilities

Bosses have a key role to play when their staff go on PHI. For starters, they need to be clear about how this affects everyone’s holiday pay. Confusion and mix-ups can lead to stress all around.

By law, your employer has to keep letting you accumulate at least the minimum holiday while you’re getting PHI. They can’t take this away from you or say you’re not eligible because you’re off sick. It’s a core part of your rights at work.

Smart companies will have solid policies in place for PHI situations. They’ll make sure their rules fit with current laws and court decisions. This might mean getting legal advice to double-check everything’s above board.

At the end of the day, your employer should be a source of support during a tricky time. They should make the PHI process as smooth as possible, keep you in the loop about your holiday pay, and respect your right to take time off. If they’re doing their job well, you’ll feel looked after and valued, even when you’re facing health challenges.

Employee Rights and Options

When you’re navigating PHI and holiday pay, knowledge is power. The more you understand your rights, the better equipped you’ll be to handle any bumps in the road.

Start by digging into your employment contract and any company policies about sick leave, PHI, and vacation time. Read through them carefully and note any questions you have. If something seems unclear or unfair, don’t be afraid to speak up.

Your HR department is there to help. They can walk you through the details of your contract and policies, and explain how they apply to your situation. If you’re not getting the answers you need, consider talking to a higher-up or your union rep if you have one.

In some cases, you might feel like you’re not being treated right. Maybe your employer is trying to deny you holiday pay or making it hard for you to take time off. If talking things through doesn’t work, you have options.

You could file a formal grievance or complaint with your company. This means putting your concerns in writing and following a set process to try to resolve the issue internally. If that still doesn’t do the trick, you might need to get legal advice.

Remember, the law is on your side when it comes to basic holiday rights and PHI. Don’t let yourself be shortchanged. Stand up for what you’re owed, even if it feels tough. With a bit of persistence and the right information, you can make sure you’re getting a fair deal.

Your Next Steps

Now that you’ve got a handle on how PHI affects your annual leave, it’s time to put that knowledge into action. Don’t let confusion or uncertainty hold you back from getting the support you need.

We’re passionate about empowering people like you to take control of your health and financial well-being. Our expert team has years of experience guiding clients through the PHI process, and we’re here to make it as smooth and stress-free as possible.

Don’t wait until you’re in the midst of a health crisis to seek help. Get in touch with us today for a free, no-obligation consultation. We’ll listen to your concerns, answer your questions, and help you build a personalised plan to protect your income and peace of mind.

With the right support in your corner, you can face whatever challenges come your way with confidence and clarity. So why not take that first step today? Contact us and let us help you secure the benefits you deserve.


Is annual leave accrued when claiming permanent health insurance from my employer? 

Yes, in most cases, annual leave continues to accrue while you are claiming permanent health insurance (PHI) from your employer in the UK. However, the specific details may vary depending on your employment contract and the insurance policy.

Can I take my accrued annual leave while on PHI? 

Yes, you are entitled to take your accrued annual leave while receiving PHI payments. Your employer must allow you to take your statutory minimum holiday within the current leave year. If you are unable to take all your leave due to your health condition, you may be able to carry over some unused days to the next year.

What should I do if I have concerns about my annual leave accrual during PHI?

If you have concerns or questions about your annual leave accrual while on PHI, start by reviewing your employment contract and any relevant company policies. If you need further clarification, speak with your HR department or a higher-up. If you feel you are not being treated fairly, consider filing a formal grievance or seeking legal advice.

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