Business aid: Dean Wilson LLP

Ian Wilson of local solicitors Dean Wilson LLP answers questions on employment law. This week: Sickness absence and annual leave

We take a look at a recent case law relating to sickness absence and annual leave and the right to carry holiday over.

Mrs Larner, a clerical worker with NHS Leeds, was absent on sick leave for the whole of the leave year April 2009 to March 2010 and did not take paid annual leave during this period. When she was dismissed the following year, her employer did not pay her for the leave she had not taken in 2009 and 2010, arguing that she was not entitled to this leave as she had not requested it or carried over to another leave year.

The Court of Appeal rejected the employer’s argument, holding that Mrs Larner was entitled to payment in lieu of this untaken leave on termination. The Court confirmed that the Working Time Directive (WTD) confers an unqualified right to four weeks’ paid annual leave and that workers unable to take this leave due to sickness absence must be able to take the leave at another time, if necessary by carrying the leave over to another leave year and stated that a worker is entitled to payment for such untaken leave upon termination of employment.

Importantly, the Court of Appeal held that workers who are unable to take leave because of sickness absence do not need to request leave for it to be carried over to another leave year.

In Summary:
• Employees on sick leave are entitled to take or carry over holidays, and to pay in lieu of holidays on termination.
• An employee who is sick either before or during a period of annual leave can take that holiday at a later date, if necessary by carrying over the leave to another leave year.
• Employees who are unable to take annual leave because of sickness absence do not have to request leave in order for it to be carried over.
• Employers can currently limit the carry over period for untaken leave by contractual/collective agreements.
• Employers can currently limit the amount of leave that employees can carry over to the 4 weeks’ leave under the WTD rather than 5.6 weeks’ leave under the WTR or employees’ contractual entitlement (subject to what the contract allows).
• Currently, employers are not under a duty to inform workers of their right to take annual leave whilst on sick leave.