Tribunal finds worker on sick leave may carry over holiday into next leave year

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In Shah v First West Yorkshire Ltd an employment tribunal has held that the Working Time Regulations 1998 can be interpreted in accordance with the European Court of Justice\’s decision in Pereda v Madrid Movilidad SA (Brief 887) to allow annual leave ruined by sickness to be retaken in the following leave year. Thus, the employer\’s refusal to allow S to retake his holiday ruined by a broken ankle in a new leave year was a breach of the Regulations.

S booked four weeks of holiday from 22 February to 21 March 2009. Unfortunately, as a result of breaking his ankle in January, he was on sick leave until 18 April, during which he was paid holiday pay (a higher rate than contractual sick pay) for the days he had booked off. When S asked to reclaim his holiday entitlement, FWY Ltd stated that the days were \’lost\’ as he returned to work after the new holiday year started on 31 March. S lodged a claim at a tribunal that under the Regulations he was entitled to take his accrued untaken leave.

The tribunal found that Reg 13(9), which provides that an entitlement to leave under the Regulations must be exercised in the year of accrual, should be interpreted consistently with the Directive so far as possible. As a result of the ECJ\’s decision in Pereda, the Directive requires national law to permit an employee who falls sick during annual leave to take that annual leave at a different time, if necessary in the following leave year. When considering if domestic legislation can be construed in accordance with a Directive, the EAT\’s decision in EBR Attridge Law LLP v Coleman (Brief 891) showed that the real question is whether to do so is \’compatible with the underlying thrust of the legislation\’.

In the tribunal\’s opinion, interpreting Reg 13(9) in accordance Pereda was \’entirely consistent\’ with the underlying thrust of the legislation. Reg 13(9) protects workers\’ health and safety by ensuring they have a period of leisure each year, rather than storing up holiday over several years. It is consistent with this purpose to allow workers who did not have a period of leisure due to ill health to take that leave in the following year if necessary.

Therefore, the tribunal construed Reg 13(9)(a) to read that leave may only be taken in the year in respect of which it is due \’save where a worker has been prevented by illness from taking a period of holiday leave, and returns from sick leave, covering that period of holiday leave, with insufficient time to take that holiday leave within the relevant leave year; in which case, they must be given the opportunity of taking that holiday leave in the following leave year\’. Consequently, the tribunal found that FWY Ltd had refused to permit S to exercise his rights under the Regulations.

The case will be reported in full in a future edition of IDS Employment Law Brief.

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