The Department for Trade and Industry has announced proposals to increase workers' holiday entitlement from 20 days per year to 28.

New research has shown that up to six million workers would benefit from an extra eight days holiday each year under the plans. Some employers currently include the eight bank holidays as part of workers' 20-day annual leave entitlement (pro-rata for part-timers).

The DTI is launching a second public consultation on the implementation of the changes. Statutory annual leave entitlement would be increased in two stages, rising from 20 to 24 days on 1st October 2007, and from 24 to 28 days on 1st October 2008.

Jim Fitzpatrick, DTI minister for employment relations, said: "Most companies already recognise that good holiday provision makes good business sense. Holiday entitlement can be a key factor in recruiting and retaining staff. Holidays are also important for productivity as they help minimise sick leave and keep people motivated and refreshed.”

An increase would move UK workers' annual leave entitlement closer to that of workers in other European countries, where holiday allowance is typically more generous.