Holiday & Sickness: Case law update

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Posted in:HR and Employment|August 17, 2012 | Join the mailing list

There have been a number of recent decisions by the European Court of Justice (ECJ) about the interplay between holidays and sickness, and in particular, an employee’s right to take sick leave instead of holiday if they fall ill during their holiday. We
have reported on these judgments earlier in the year –
Employees who fall sick whilst on holiday can retake time off

More recently the Court of Appeal has made a ruling in respect of an employee’s holiday entitlement whilst on long term sick leave. The Court of Appeal held that an employee, who had been on sick leave for an entire year and had not taken any holiday during
that time, was entitled to payment in respect of that year’s unused statutory holiday entitlement on the termination of her employment. It is noteworthy in this case that it did not matter that the Claimant had not requested holiday or asked for it to be carried
forward during the previous holiday year.

Although the Court of Appeal declined to provide guidance in this difficult area, it is clear that employers should allow employees who have been on long-term sick leave and have not had the opportunity to take their holiday, to carry over their accrued

Alison Loveday of Berg commented: “If you are considering terminating the employment of employees on long-term sick leave, it is important that you have evidence to support a fair reason to dismiss (this could potentially be capability) and that a fair procedure
is followed.  If an employer dismisses a worker on long-term sick leave without implementing a fair capability procedure, it might end up facing an unfair dismissal claim worth a lot more than the workers’ holiday pay entitlement.

In light of the recent ECJ and Court of Appeal decisions, I would suggest that now is a good opportunity to tighten up your sickness absence policies and procedures and, to review the position in respect of any workers on long-term sick leave who may be
continuing to accrue holiday.
To discuss how we can provide further advice in connection with these issues, please contact Alison Loveday, Managing Partener and Head of Employment Team, by email to or alternatively you can call Alison on 0161 833 9211.

The information and opinions contained in this article are not intended to be comprehensive or to provide legal advice.  No responsibility for this article’s accuracy or correctness is assumed by Berg or any of its partners or
employees.  Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of the contents of this article.

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