Annual Leave and Long Term Sickness
February 18, 2008
In 2005 Ainsworth v HMRC became a landmark case relating to long term sickness and annual leave accrual. This went to the Court of Appeal and it was held that an employee does not have the right to accrue annual leave entitlement under the Working Time Directive 1998 whilst on long term sick leave.
The case (now called Stringer v HMRC) was referred to the House of Lords on appeal, who decided to refer it to the European Court of Justice (ECJ). No ruling has been given yet but last month the Advocate General, Verica Trstenjak, gave his opinion on the case. His decision was that annual leave entitlement does accrue whilst on long term sick leave, which is a curious decision given that the Working Time Directive is a health and safety law to ensure that employees take time off from work; and employees who are off sick cannot take time off as annual leave.
This means that employees who are off sick for a long period of time would be entitled to take all their accrued annual leave once they returned from sick leave. If the employee leaves the company, they would be entitled to payment in lieu of holidays accrued but not taken, even if they were absent for the entire holiday year – this could amount to weeks or months of pay. I wonder what would happen for employees who accrued all their holidays at a full time rate whilst off sick, but then came back to work part time – they would probably have far too many holidays than they were able to take.
The ECJ ruling hasn’t been passed yet; and it may not agree with the Advocate General. However his opinion is normally a good indicator of what will be decided in court. So at the moment employers can still work on the basis that annual leave does not accrue on long term sick leave, but may need to change the process at some point in the future when the ECJ ruling is passed on this case.
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