European Court ruling offers clarification on holiday leave accrued during sickness

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Clearer guidance over accruing holiday leave during a period of sickness has been given by the European Court of Justice (ECJ).
In a recent judgment, the minimum allowance to be carried forward was confirmed as four weeks, as specified by the Working Time Directive (WTD). This must be taken within 15 months, otherwise it is lost.
Neidel v Stadt Frankfurt Am Main concerned a retired public servant, who had been on long-term sick leave and as such had not taken a vacation due to incapacity. On retirement he claimed pay in lieu of his untaken time off which amounted to 86 days.
The ECJ rejected his claim for additional leave beyond the four weeks allowed for by the WTD. It made it clear that Member States are able to provide for increased entitlement if they choose.
Tim Wragg, Principle Associate at Eversheds, commented: “This will be good news to the UK Government which had sought to restrict entitlement to leave in such circumstances to a minimum of four weeks.”
Thanks to previous cases it was already established that employees could accrue annual leave if they are too ill to take time off. However, questions remained over the amount of holiday they could carry forward and the period during which it must be taken.
The other issue considered was the appropriate period of carry over. German law limited it to nine months. However, the Court said that this was insufficient to allow staggered rest periods which can be planned in advance.
Previously a period of 15 months was found to be long enough by the Court. On this occasion it stated that the carry over must exceed the reference period in which it is granted, ie 12 months.
The UK Government had proposed a carry-over limit of 12 months, however, this ruling suggests that that time would not be adequate.
Wragg concluded: “What remains to be seen is whether the Government will now hold out for the period of 12 months carry over it has proposed or, on the basis of [the] decision and the fact such period is not “substantially” longer than a year, the Government will reconsider and propose a longer period in light of the risk a mere 12 months may present.”

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