Christmas Shutdown 2026: Leave Rules & Notice Template

Many UK businesses close between Christmas and New Year. But can you actually require employees to use annual leave for the shutdown? What notice must you give? And how does it work for part-time staff? This guide covers everything employers need to know about Christmas shutdowns in 2026.

Can employers force employees to take leave at Christmas?

Yes. Under the Working Time Regulations 1998, employers have the right to tell employees when to take some or all of their statutory annual leave. This includes directing them to take leave during a Christmas shutdown period.

Check the contract for agreed notice arrangements. The default requirement is notice. The employer must give the employee notice that is at least twice the length of the leave being required. For three days of required leave, allow at least six days of notice and tell the worker before that notice period begins. See GOV.UK notice guidance.

Christmas & Boxing Day 2026: the bank holiday dates

In 2026, Christmas Day falls on a Friday and Boxing Day on a Saturday. Because Boxing Day falls on a weekend, the substitute bank holiday moves to Monday 28 December. New Year's Day 2027 falls on a Friday.

For a Monday-to-Friday employee whose bank holidays are accounted for separately, the shutdown from 25 December 2026 to 1 January 2027 uses three additional annual leave days: 29, 30 and 31 December. If your recorded allowance includes bank holidays, account for those dates within that allowance as well, without deducting them twice. Shift workers and part-time staff need their actual working pattern checked. Scotland also has a substitute bank holiday on 4 January 2027; check it if your shutdown extends into that week. Planning ahead? In 2027 Christmas Day and Boxing Day fall on a weekend, so the Christmas bank holidays 2027 are the substitute days on Monday 27 and Tuesday 28 December.

Reviewed 15 September 2026. Dates checked against GOV.UK bank holidays.

Structuring your Christmas shutdown policy

A clear policy prevents confusion and complaints. Your leave policy should address:

• Shutdown dates — specify the exact dates the business will close each year.
• Leave deduction — state how many annual leave days will be deducted and confirm that bank holidays are separate (or included, depending on your policy).
• Notice period — when employees will be told about the shutdown (ideally in writing at the start of the leave year).
• Insufficient leave — what happens if an employee has already used all their annual leave. Options include unpaid leave, additional paid company leave, or allowing them to work during the shutdown if operational needs allow.
• Essential cover — if some roles must be staffed over Christmas (e.g. IT support, customer service), explain how you will select staff fairly — rotation is common.

What if an employee has no leave left?

This is more common than you might think, especially if employees front-load their leave during summer. You cannot force an employee to take unpaid leave unless the contract allows it. The safest options are:

• Consider extra paid company leave, or another agreed arrangement that preserves statutory entitlement in each leave year. Do not automatically deduct this shutdown from next year's statutory allowance.
• Offer unpaid leave by mutual agreement.
• Let them work during the shutdown if there is meaningful work to do.

Whatever you choose, document it in writing and apply the same approach to all employees in the same situation.

Part-time workers and Christmas shutdowns

Part-time workers must be treated fairly. If your shutdown falls on days they do not normally work, you cannot deduct annual leave for those days. Conversely, if the shutdown covers their normal working days, the deduction should be pro rata.

Religious and cultural considerations

Not all employees celebrate Christmas. Some may prefer to save their leave for Eid, Diwali, Hanukkah, or other celebrations. A mandatory Christmas shutdown limits their flexibility. Consider:

• Keeping the mandatory shutdown as short as possible (e.g. only the days between bank holidays).
• Offering a "floating holiday" that can be used for any religious or cultural observance.
• Allowing skeleton-crew working over Christmas for employees who would rather use their leave elsewhere.

This is not just about good practice — under the Equality Act 2010, policies that disproportionately disadvantage employees of a particular religion could amount to indirect discrimination unless you can objectively justify them.

How to calculate the cost of a Christmas shutdown

From a business perspective, the main cost of a shutdown is not the leave itself (employees are entitled to those days regardless) but potential lost revenue and the impact on holiday pay calculations for irregular-hours workers. Weigh this against the benefits: reduced overhead, higher morale, and simplified scheduling.

How Leavely simplifies Christmas shutdowns

Managing a shutdown across dozens of employees — each with different working patterns, leave balances, and pro-rata entitlements — is where spreadsheets break down. Leavely handles it cleanly:

• Company leave blocks — set a shutdown period once and it applies to all employees automatically, with correct deductions based on each person's working pattern.
• Bank holidays pre-loaded — Christmas Day, Boxing Day, and New Year's Day are already in the system for all UK regions.
• Balance warnings — flag employees who do not have enough leave remaining to cover the shutdown, well before December.
• Part-time auto-calculations — pro-rata deductions are handled automatically based on each employee's contracted days.