How do holiday and sick leave interact? Tribunal gives guidance | Articles | Knowledge Hub | B P Collins LLP Solicitors
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13 October 2015

How do holiday and sick leave interact? Tribunal gives guidance

The interaction between sick leave and annual holiday leave poses a tricky problem for employers. In Plumb v Duncan Print Group Limited, the Employment Appeal Tribunal (EAT) has clarified the position for employees who have to take prolonged periods off work for medical reasons with regard to the basic four weeks' statutory holiday entitlement guaranteed under the European Working Time Directive (WTD).

Mr Plumb started working for Duncan Print Group as a printer in November 1987. In April 2010, he sustained an injury at work and was on sick leave for more than three years. He did not take holiday leave during those years and, after his employment was terminated in February 2014, he sought payment in lieu of those entitlements. His leave year ran from 1 February to 31 January.

The Employment Tribunal (ET) dismissed his claim on the basis that he could not show that he was unable, by reason of his medical condition, to take annual leave.

In allowing Mr Plumb's appeal, the EAT identified a mismatch between the Working Time Regulations 1998 (WTR) and the WTD, which they implement into UK law. Under Article 7 of the WTD, an employee who is on sick leave, and who would be permitted to take paid annual leave during that sick leave, is not required to take annual leave but may choose to do so. The ET had erred in concluding that Mr Plumb was required to demonstrate that he had been medically incapable of taking holiday leave in order to carry forward his annual leave entitlement.

Having decided not to take the leave, he was entitled to do so at a later date. Regulation 13(9) of the WTR, which provides that annual leave may only be taken in the leave year in respect of which it is due, must be interpreted accordingly in order to give effect to the WTD.

The EAT acknowledged that the WTD did not confer an unlimited right on sick workers to carry over periods of annual leave to subsequent years. However, in interpreting the WTR in conformity with the WTD, it found that employees on sick leave are entitled to take holiday leave within 18 months of the end of the year in which the entitlement to that leave accrued.

In this case, Mr Plumb was entitled to payment in lieu of annual leave in respect of the 1 February 2012 to 31 January 2013 leave year but not for the leave years 1 February 2010 to 31 January 2011 or 1 February 2011 to 31 January 2012. The matter of the precise amount of the payment was remitted to the ET for determination in the light of the EAT's judgment.

Both parties were granted leave to appeal to the Court of Appeal.

Disputes concerning holiday pay entitlement are common. For clarity on the applicable law, contact Kathryn Fielder. Call 01753 279029 or email employmentlaw@bpcollins.co.uk.

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