16th July 2015

Reconciling sickness absence and holiday pay is an issue that comes before Employment Tribunals (ETs) time and again. In the case of Plumb -v- Duncan Print Group Limited, the ET had to determine: (1) if an employee on sick leave had to be able to show he was unable to take holiday due to his illness in order to carry it over; and (2) is the right to carry over holiday unlimited?

Brief facts of the case

Mr Plumb, a printer, had four years’ sickness absence following an accident in April 2010 and until his employment terminated in February 2014. He did not take paid annual leave during the leave years of 2010, 2011 and 2012 and upon dismissal, he brought a claim for payment in lieu of his accrued but untaken holiday. The ET dismissed the claim as Mr Plumb could not demonstrate that he was unable, by reason of his medical condition, to take his annual leave entitlement whilst on sick leave.

EAT’s decision

The Employment Appeal Tribunal (EAT) overturned this decision and held that an employee on sick leave did not need to demonstrate that he was unable, by reason of a medical condition, to take annual leave. The EAT referred to Article 7 of the Directive which requires that 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. If the employee chooses not to take annual leave during a period of sick leave, he is entitled to take it at a later date.

However, the EAT stated that this did not give an employee the unlimited right to carry over periods of annual leave to subsequent years and in accordance with the Directive, Regulation 13(9) of the Working Time Regulations 1998 was to be read as permitting a worker to take annual leave within 18 months of the end of the leave year in which it was accrued, where the worker was unable or unwilling to take annual leave because he was on sick leave and, as a consequence, did not exercise his right to annual leave.

Finally, this case only addressed the four weeks’ leave granted under Regulation 13, and not the additional leave granted under Regulation 13(A). Previous case law shows that additional leave is not eligible to be carried forward.

If you would like to discuss how this case may affect your business, please contact the team on 0161 437 0013 or by email at info@lawbydesign.co.uk