An important decision for employers has today been handed down by the Court of Appeal regarding the right of workers affected by illness to carry over holiday entitlement from one year to the next. Employers should take note of the decision, as it has implications for workers who are unable or unwilling to take annual leave because of sickness.
The Court of Appeal has held that if a worker is unable or unwilling to take their full statutory holiday entitlement in a particular holiday year due to sickness absence, they must be allowed to take it at another time, even if this results in leave being carried over to the next holiday year.
Furthermore, contrary to the earlier leading authority, this is the case even if the employee did not request to take or carry over the leave in the holiday year in which it was accrued. This would mean, where applicable, that a payment in lieu of holiday on termination of employment would have to include payment in respect of holiday accrued but untaken in previous leave years.
Bethan Jones, an employment law solicitor with Oswestry law firm Lanyon Bowdler comments “this is an important decision for employers who have workers on long-term sickness absence, as the position was not clear before this. Employers should take legal advice on how to manage long-term sickness absence, in order to avoid workers accruing large amounts of holiday which could be costly and inconvenient to the employer when they are eventually taken, or expensive to reimburse on termination.”
Bethan goes on to say “It is emphasised that the principles set down in today’s judgment should only apply to the 4 weeks’ holiday entitlement under European law (as opposed to the 5.6 weeks’ entitlement under UK law) and, unless a worker’s contract of employment states otherwise, not to any other contractual entitlement (including bank holidays) that a worker may have to holiday in excess of 4 weeks.”
