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GN Law Media: Further developments on employees rights to holiday pay when sick

Following on from our recent Article, the Court of Appeal in NHS Leeds v. Larner has now addressed the issue of the right to annual leave and has provided further interpretation of Article 7 of the Working Time Directive, though in a situation where the employee did not attempt to take leave.

The Claimant was on long term sick leave for the entire leave year 2009/2010, during which she had not taken leave nor requested that
it be carried over to the following leave year. Mrs Larner was dismissed and the claim arose from a failure to pay her in lieu of the untaken leave. The NHS argued that she was no longer entitled to leave or a payment in lieu because there had not been any request to take or carry forward leave as at the end of the leave year.

The Claimant relied on previous interpretations by the EU of Article 7.  We reported on one such case Asociacion Nacional de Grandes Empresas de Distribucion (ANGED) v Federacion de Asociaciones Sindicates (FASGA) where the ECJ had decided that a worker was entitled to take paid annual leave, which had not been taken by reason of sickness, at a later date even if this meant that it was taken in a subsequent
leave year. Mrs Larner claimed that she had the right to carry forward untaken leave and be paid in lieu of that leave on the termination of her
employment, without a prior request to take leave.

The Court of Appeal stated that the recent EU case of Neidel v. Stadt Frankfurt am Main… reinforced the Claimant’s case that Article 7 did
not impose any requirement of a prior leave request and decided the following:

- She was entitled to paid annual leave in the leave year 2009/2010;

- She was prevented from taking her paid annual leave because she was sick;

- She was entitled to carry her untaken paid annual leave forward to the next leave year in 2010/11 without making a prior request; and

- She was entitled to payment on termination for the paid annual leave she had been prevented from taking because her employment was terminated in that year before she could take the carried forward leave.

As a result of a previous ECJ decision, Article 7 has direct effect against emanations of the state, such as the NHS, and therefore it was unnecessary to discuss the construction of the Working Time Regulations 1998 as would be necessary in the case of a private employer.

Even though it is a different scenario to that considered previously, the interpretation of Article 7 appears to be consistent with the EU decisions in holding that the right to annual leave should not be restricted.

Maria Corder

Solicitor 14.08.12

Posted on Wednesday, 15th August 2012