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The right to paid holiday when off sick is not dependent on making a request to take that holiday
In a case backed by Unite, the Court of Appeal has confirmed that there is no need for a worker who is off sick to ask to take or carry forward her statutory annual leave in order to be entitled to be paid for it:
Mrs Larner was off sick from her role as a clerical officer for NHS Leeds for the whole of the 2009-10 holiday year and into the next holiday year. She was dismissed without returning to work. NHS Leeds refused to pay for her holiday for the 2009-10 holiday year, arguing that she was not entitled to it because she made no requests to take holiday or to carry it over to a later leave year.
The Court of Appeal found in favour of Mrs Larner. The decision was made more straightforward because while the case was waiting to be heard, the European Court of Justice delivered its judgment in another important case — Dominguez v Centre Informatique du Centre Ouest Atlantique ([2012] IRLR 321).
In the Dominguez case the ECJ decided that the right to four weeks’ paid annual leave under the Working Time Directive has direct effect against public sector employers, such as NHS Trusts. In other words, public sector workers can enforce the right directly against their employer in the employment tribunal, regardless of any national law restrictions on the right contained in the Working Time Regulations.
Since the Working Time Directive does not require a worker to request leave before being entitled to be paid for it on termination, NHS Leeds was not allowed to insist on this rule as a condition of payment. Mrs Larner had the right to take the annual leave she had been unable to take because of sickness. Since she did not have the opportunity to take it before being dismissed for incapacity, NHS Leeds had to pay her for it.
The Court of Appeal also addressed the position of private sector employees and confirmed that private sector employers likewise are not allowed to insist that a worker on long-term sickness absence asks to take or carry forward their annual leave in order to be paid for it.
NHS Leeds v Larner [2012] EWCA Civ 1034
The Larner case confirms that at least as regards the minimum four weeks of holiday under the Working Time Directive, employers are not allowed to operate a “use it or lose it” policy on holiday for workers on long-term sick leave. These workers are entitled to their statutory holiday pay for unused leave on termination of the employment, regardless of whether they have asked to take it or carry it forward into a new holiday year.
The position regarding the additional eight days of leave under the Working Time (Amendment) Regulations 2007 is less clear. However, a recent ECJ case, Neidel v Stadt Frankfurt am Main ([2012] EUECJ C-337/10), has suggested that while the government has little freedom in relation to the rules it makes for the twenty days of statutory holiday governed by the European Directive, it has much greater freedom to make rules limiting or restricting the right to the extra eight days of annual leave under national law.
Holiday taken during sickness absence should be paid at the normal rate of pay, even if all rights to contractual and statutory sick pay have been exhausted.