Legal opinion: Employees who fall ill while on holiday

The question of whether or not employees can reclaim holiday if they have fallen ill during their annual leave has been a thorny issue for some time. Not any longer, as the European Court of Justice (ECJ) recently ruled very much in favour of employees. Barrister Laura Daniels looks at what the decision means for employers.

In the Spanish case of ANGED v FASGA, the ECJ held that staff who fall ill while they are on annual leave can take their holiday again at a later date.

Employees were already allowed to retake their holiday if they became ill before the start of their time off; this decision now extends that right. This will no doubt cause concern for some employers that a member of staff can book one week off, become ill for five days and then reclaim the holiday without the need for a sick note to confirm the illness as genuine.

The decision puts the honesty of employees to the test and could leave businesses open to abuse.

Annual leave under EU law

The case itself was brought under art.7(1) of the Working Time Directive 2003/88/EC, which is implemented in Great Britain as reg.13 of the Working Time Regulations 1998 (as amended). This enshrines a worker’s right to annual leave of at least four weeks per year; an additional 1.6 weeks’ annual leave, over and above what is required under the Working Time Directive, is provided for by reg.13A of the Regulations.

The right to paid annual leave is given particular importance in EU law as demonstrated by the fact that this right cannot be interpreted restrictively.

The purpose of annual leave

The Court highlighted that the purpose of the entitlement to paid annual leave is to enable the worker to rest and to enjoy a period of relaxation and leisure; differing from the purpose of the entitlement to sick leave in that it is given to the worker so that they can recover from an illness that has caused them to be unfit for work. This was identified in the earlier case of Pereda v Madrid Movilidad SA, which held that a worker who is on sick leave during a period of previously scheduled annual leave can retake their annual leave during a period which does not coincide with the period of sick leave. This decision related to a worker who falls ill before annual leave commences.

In ANGED, the Court decided that the point at which temporary incapacity arises is irrelevant and therefore a worker is entitled to take paid annual leave which coincides with a period of sick leave at a later point in time, whether he became ill before or during the annual leave.

Carrying over annual leave

If a worker does fall ill during annual leave, any rescheduled holiday can be taken outside of the reference period for annual leave set by the employer, ie it can be taken the following year, if, for example, the annual leave during which the worker falls ill is at the end of the relevant holiday year.

Requesting annual leave

So, a worker must have the opportunity to take four weeks annual leave. It appears from the judgements in both ANGED and Pereda however, that the onus is on the worker to request a new period of annual leave. This question may be clarified by the upcoming Court of Appeal decision in NHS Leeds v Larner.

It was stated in Pereda that, under the Working Time Directive, a worker can take sick leave during annual leave, but if they don’t want to, then the leave must be granted for a different period. Once a worker has made a request, the employer should allow leave to be taken on the requested dates, or if not possible, on different dates, even if such later dates fall outside the reference period for that annual leave.

Additional annual leave

All of the above will apply to holidays taken in accordance with the Working Time Directive, ie four weeks per year for full-time workers, but are not likely to apply to the additional 1.6 weeks provided for by the Working Time Regulations and will not apply to any contractual holiday taken in excess of this requirement. What type of holiday the worker has taken will be for a tribunal to decide, depending on the circumstances of each case.

Potential for abuse

As mentioned earlier, this decision will require employers to rely on the honesty of staff. The particularly contentious area will be short periods of sick leave, seven days or fewer, which the worker is able to self-certify for. The potential for abuse is clear, as an employee with only one week of holiday booked may be able to reclaim that entire period of annual leave without having to provide certification from their doctor. Abuse of this situation would likely amount to gross misconduct but may be difficult to prove.

This decision was not well received by the UK Government, with Vince Cable commenting that this ruling “goes far beyond what was originally intended by the Working Time Directive and would simply strangle small business”. For now, however, this represents the law.

Laura Daniels, barrister, Kings Chambers, Manchester


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