Case Round Up Pereda v Madrid Movilidad SA

The European Court of Justice (ECJ) has decided that workers who are sick during a period of pre-arranged annual leave are entitled to defer the leave until a later date, after they have recovered.

If the leave cannot be taken during the current holiday year, it should be carried forward to the next holiday year. It is unclear how this decision can be effected in the UK, given that the Working Time Regulations expressly preclude the carry-over of holiday.

Notwithstanding that uncertainty, the implications of this decision for business are potentially significant.

Pereda worked for Madrid City Council. He requested and was granted four weeks’ leave well in advance of the leave date.

Before starting his leave, he had an accident at work and was signed off sick for a period that included most of his pre-arranged holiday period.

Despite that, the council refused to allow Pereda to change his holiday dates. He challenged that decision and his case went all the way up to the ECJ.

The ECJ held that employers must allow workers to take their annual leave at another time if they are ill during their annual leave.

If the holiday cannot be rearranged during the current holiday year, the employee must be given the right to carry the leave forward.

The court emphasised that the right to annual leave is an important social right that protects the health and safety of workers and cannot be derogated from.

It also stated that sick leave serves a different purpose from annual leave; it is there to allow the employee to recover from illness, whereas the purpose of annual leave is to allow the employee to rest and have a period of leisure.

From the judgment, it is not clear if the decision is limited to cases where the employee is ill before the leave starts, or whether it also applies when the employee becomes ill during a period of annual leave.

At the moment this case is – strictly – applicable only to workers in public authorities because they can directly enforce the European directive against a public authority.

However, if tribunals can construe the regulations to give effect to this right they will, and this could mean that all workers could enforce this right, including those employed in the private sector.

If the tribunals cannot construe the wording of the regulations to give effect to this right, they will have to be amended.

Key points

  • Workers should be allowed to take annual leave at a different time if they are ill during their pre-arranged annual leave.
  • Employers should allow workers to take leave in a different leave year if necessary.
  • This decision conflicts with UK law, which may need changing following this decision.

What you should do

  • Employers should conduct a review of their policies and be alive to the challenge that employees who are prevented from taking annual leave at another time could mount.
  • Regardless of the uncertainties that this decision throws up, it is significant, and all employers should review sickness and holiday policies in light of it. A clear policy for the reporting of sickness absence, which deals with the situation where an employee falls ill while on holiday, is recommended. The policy should make clear what steps an employee has to take to report themselves as sick. For sickness falling during holidays, employers could, for example, require employees to provide medical evidence of their ill health. These safeguards may go some way to deter a would-be malingerer, and at the very least should provide the employer with a basis on which to challenge a claim that appears to be dishonest.

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