The Employment Tribunal has awarded a senior employee more than £400,000 after finding that he had accrued over 800 days of untaken annual leave across several decades of employment. The case highlights the significant financial risks for employers who fail to properly manage holiday entitlement, and comes at a time when new statutory duties to keep holiday records have just come into force under the Employment Rights Act 2025.
In this article we explore the Ageli v Sabtina Limited case, outline the risks for employers following new statutory holiday record‑keeping duties and provide practical steps for employers to remain compliant.
Mr Ageli, the claimant, began working for Sabtina Limited, the respondent, in 1987 - initially as deputy managing director and later as commercial manager. His contractual holiday entitlement was 30 days per year, increasing to 45 days from 1996.
Due to persistent staff shortages, the claimant was frequently unable to take his annual leave. Between 1987 to 1989 he took no holiday at all, as he and his personal assistant were the only full-time employees, and the claimant was solely responsible for the day-to-day running of the Respondent’s business. Between 1988 and 1996, requests for more than 200 days of annual leave were refused.
The tribunal found that it was agreed between the claimant and the respondent that unused holiday could be carried forward from year to year and be paid at a later stage. Although payments were made on some occasions, by the time the claimant’s employment ended, he had accumulated 827.25 days of untaken annual leave.
In March 2024, the claimant was dismissed for alleged gross misconduct. The tribunal found that the dismissal was procedurally unfair and that there had been a total failure to comply with the ACAS Code of Practice. Crucially, the tribunal also held that the respondent had failed to pay the claimant’s accrued holiday entitlement.
The tribunal awarded the claimant £391,942.77 in respect of unpaid holiday, together with a basic award of £14,070 and a compensatory award of £91,489.73 following a finding of unfair dismissal.
The decision in the Ageli v Sabtina Limited case is particularly significant in light of the new record keeping requirements under the Employment Rights Act 2025, which came into force on 6 April 2026.
Employers are now required by law to keep records of annual leave and holiday pay. Employers must record:
Employers must retain these records for at least six years. Failure to keep adequate records can result in enforcement action and, in some cases, may constitute a criminal offence. The likely maximum penalty is an unlimited fine.
Records can be kept in any reasonable format, such as payroll systems or spreadsheets. However, the burden is firmly on employers to demonstrate that workers have received their correct holiday entitlement and pay.
Employers should take the opportunity to review holiday processes and documentation, particularly where:
This case serves as a reminder that failures to actively manage holiday entitlement can give rise to substantial and unexpected liabilities, particularly where record keeping is poor or longstanding practices have gone undocumented.
For more information please contact our employment team.
