Long-term sickness and holiday entitlement
20th January 2012
Uncertainty continues for employers after two conflicting judgements are delivered at the Employment Appeal Tribunal (EAT).
Recent judgments of the Employment Appeal Tribunal (EAT) have delivered conflicting guidance regarding the circumstances in which an Employee on long-term sick leave will be entitled to payment in respect of statutory holiday under the Working Time Regulations (WTR). The Cases were heard 2 weeks apart, but uncertainty for Employers remains about the correct approach, until hopefully the Court of Appeal clarifies the position (possibly in early 2012).
The WTRs 1998 lay down the basic rules governing entitlement to paid annual leave, including procedures to be followed by both Employers and Employees concerning minimum notice periods to be given when either holiday is requested, or an Employer seeks to restrict when holiday may be taken during the leave year. What is clear (and not in contention) is that an Employee continues to accrue annual leave entitlement even whilst he/she is on sick leave.
The issue of contention raised by the recent EAT cases of NHS Leeds v Larner and Fraser v Southwest London St George’s Mental Health Trust surrounds the question whether, in order to trigger entitlement to an actual payment, an Employee must notify his/her Employer (during the Leave Year in question) that they wish to take statutory holiday (paid leave) either during the period of sick absence, or subsequently after recovery.
The decision in the case of Larner (heard on 29th June 2011) followed the reasoning in earlier cases and concluded that the entitlement to paid holiday of a worker absent on sick leave does not depend on him/her having given notice to take that holiday during the Leave Year in question. In practice this would mean that a worker absent for 2 years would, on subsequent dismissal, be entitled to payment in lieu of holiday pay for the 2 years in question despite having not previously requested the leave.
However, in Fraser (heard on 13th July 2011) the EAT ruled that a proper interpretation of the Regulations dictated the opposite: an Employee would lose the right to paid leave (or to receive payment in lieu on termination) if such notice was not given during the relevant Leave Year.
The above example highlights the difficulties facing Employers when dealing with issues in the workplace and trying to respond in accordance with the law. Employment law in particular changes almost weekly as new legislation and court rulings come into force.
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Chartered Legal Executive in Employment & Litigation Teams
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