Carrying forward unused holiday after sickness absence

A worker who has not been able to take statutory holiday during the holiday year because of sickness must be allowed to carry that holiday forward into the next holiday year, even if the employment contract expressly forbids this (Dominguez v Centre Informatique du Centre Quest Atlantique [2012] EUECJ C-282/10).

However, the right to carry forward statutory annual leave is not unlimited. In KHS AG v Winfried Schulte [2011] EUECJ C-214/10, the ECJ confirmed that unused holiday must not be allowed to build up indefinitely, because otherwise the leave would lose its main purpose as rest, and instead become “merely a period of relaxation and leisure”. It would also, said the ECJ, cause problems for the employer who would be storing up a liability to pay for large amounts of unused leave if the employment eventually ends due to sickness absence, and may struggle to organise work to cover the absence.

Instead, collective agreements and national laws can fix a cut-off point for any carry forward of annual leave, although that cut-off point must not be too short. As a guide, in Schultz-Hoff v Deutsche Rentenversicherung Bund [2009] EUECJ C-350/06, a carry-forward limited to six months was ruled too short, but a 15-month cut-off point in the Winifried Schulte case was ruled acceptable.

In both the public and the private sector, workers are entitled to their statutory holiday when off sick whether or not they make a request to take holiday. They are also entitled to be paid for any unused holiday at the end of the employment. This was decided in NHS Leeds v Larner [2012] EWCA Civ 1034, a case supported by general union Unite.

In Sood Enterprises Limited v Healey [2013] UKEAT 0015/12/B1/1403, the Scottish EAT has confirmed that the right to carry forward annual leave unused due to sickness absence applies only to the four weeks of holiday under the Working Time Directive. Member states are allowed to make their own rules about annual leave beyond the mandatory four weeks (Neidel v Stadt Frankfurt am Main [2012] EUECJ C-337/10).

Holiday taken during sickness absence must be paid at the normal rate of pay (see page 105-106). It makes no difference that rights to contractual and statutory sick pay have been exhausted.