The issue of whether a worker who is off sick is entitled to paid annual leave was clarified somewhat by a decision of the European Court of Justice (ECJ) in January 2009.
The ECJ decision followed the case of Stringer and others v HMRC concerning entitlement to accrue paid annual leave during long-term sick leave. This case previously under the name Inland Revenue Commissioners v Ainsworth, concerned a number of workers who were on long-term sick leave who made tribunal claims for statutory holiday pay under the Working Time Regulations. The Employment Tribunal and the Employment Appeal Tribunal held that the workers, who were off sick for more than a year, were entitled to accrue and be paid for their statutory annual leave entitlements. However these decisions were rejected by the Court of Appeal in April 2005 who held that the right to statutory paid holiday does not continue to accrue whilst an employee is absent on long-term sick leave. The decision was based on the argument that leave cannot be taken by someone who is not at work. The claimants then appealed to the House of Lords who remitted the issue to the ECJ.
The ECJ heard the case together with the German case of Schultz-Hoff v Deutsche Rentenversicherung Bund which concerned the related issue of whether a worker’s right to annual leave expired at the end of the leave year or whether the leave had to be carried over to the next year.
The ECJ has ruled that a worker who is off work on sick leave does continue to accrue statutory holiday while they are off sick. The ECJ ruled that:-
- a worker who is on sick leave for the whole leave year, or for part of a leave year, and who has not been able to take the holiday they have accrued by the end of the leave year, will not lose the accrued statutory holiday
- if a worker has their employment terminated, they must be paid in lieu for any statutory holiday accrued if they have not been able to take that holiday because they were off sick.
The ECJ did not decide whether paid holiday can be taken while a worker is actually off sick. It is the case that many workers who are absent on long-term sick leave and who have exhausted their entitlement to sick pay ask to take paid holiday. The ECJ decided that this was a matter for the UK Courts to decide. In June 2009 the House of Lords decided that workers can claim holiday pay even while they are on sick leave. This means that employees who are off sick can request and take paid holidays just like any other employee. However the House of Lords judgment did not deal with issues concerning the carrying over of leave and while this still remains unclear various cases have established that leave may be carried over in certain circumstances.
The key issues arising from the House of Lords decision are:
- workers accrue statutory holiday under the Working Time Regulations while they are off sick
- employers should allow workers to take paid statutory holiday leave while they are off sick where they request to take it.
- workers are entitled to be paid for statutory holiday accrued but not taken where their employment has been terminated part way through a leave year
- non-payment of holiday pay can be taken as an unauthorised deduction from wages claim under the Employment Rights (NI) Order as well as under the Working Time Regulations .
Workers who have been on long-term sick leave, and who wish to claim the unpaid holiday pay they believe they have accrued while off sick, should discuss this with their employer. If a worker wishes to make a claim to an industrial tribunal for the holiday pay they would have accrued while on sick leave, they will have to raise a grievance with their employer first.
Further information on all aspects of sick leave and holidays is available from your local CAB or from the Labour Relations Agency on 028 9032 1442.
Siobhan Harding is an Information and Policy Officer with Citizens Advice