Sickness Absence while on Holiday

Does an employee who is on long term sick leave need to show that there was a reason that they did not take annual leave during the period they were off a long period of sick leave?

This is one of the questions that was raised in Plumb v Duncan Print Group Ltd last month. The short answer is no. Given previous decisions in cases like Stringer and Larner this is not a surprise.

While as a rep I have frequently been asked by members to advise employees on whether they have the right to their unpaid leave being paid upon dismissal the specific circumstances raised in this case are rare (because not many employees are on sick leave for years on end!). Still, while not necessarily a helpful case this is a good case to clarify the status of the untaken holiday of those who are on long term sickness absence.

The claimant in this case was was a longstanding employee of the Respondent. In April 2010 he suffered an injury at work and was from that point onwards off sick until his dismissal in February 2014. The claimant was therefore off sick for a continuous period of just under four years and, during that time he did not take any leave annual leave.

When he was dismissed the claimant asked that  outstanding annual leave from the Respondent for the annual leave years in which he had not taken any leave be paid to him.

Give a Reason?

(Mis)Applying Larner the first tier tribunal found that there was no evidence that the claimant had been ‘unable’ to take annual leave in the relevant years and, therefore the ability to carryover leave that Larner had allowed did not apply.

On appeal, Justice Lewis found following the rationale of the ECJ in C-44/08 Pereda v Madrid Movilidad SA [2009] ECR I-8405 that since the purpose of annual leave for relaxation and leisure and sickness leave is recovery the two are normally incompatible. For that reason reference to inability should be read with that in mind. Therefore the first tier tribunal was in error to conclude that the claimant on sick leave must give a reason for not being able to take annual leave: being on sick leave is reason enough.

It’s a Rollover …

The normal situation is that unless there is a contractual clause to that effect an employee could not carry over leave from one year to the next; in other words, they had to use it or lose it. Larner had however established that a claimant could in certain circumstances ‘carry over’ annual leave if they are unable to take it because of sickness absence to the subsequent year. Separate caselaw (KHS AG v Schulte) had established that the right to carry over leave, even when a claimant had been unable to take annual leave, was not indefinite and that a cut off of 15 months was (in the circumstances of that case) reasonable. The second issue before the EAT in Plumb therefore was whether the right to carry over leave extended to 40+ months (just under four years). Unsurpringly, given the finding in KHS AG it found it did not. Interpreting the UK WTR Regulations in line with the EU legislation and caselaw the EAT found that, at a maximum, the time limit was 18 months. Therefore, any unclaimed holiday over 18 months was could not be enforced.

Practical Impact

The case itself does not strike me as especially important save for the explicit clarification that no reason for not taking annual leave needs to be given when a worker is absent on sick leave.

However, the case prompt three pieces of advice for reps when faced with assisting members on long term sick leave:

  • If a member is dismissed following long term sickness absence then ensure there is clarity at an early stage of the leave they were eligible for which they did not take in the preceding 18 month’s. If this leave is not paid on dismissal the member may have a claim for unauthorised deduction of wages.
  • Likewise, if an employee has been on long term sick but then returns to work ensure that their  leave on return is correct. In my experience payroll/HR are more likely to make mistakes here than when dismissing a worker because they may not have holiday pay in mind as much. Again, if not correct the worker may have a claim for unauthorised deduction of wages.
  • Less likely to be relevant but important when there is an absence of over 12 months and no sign of a dismissal on the horizon I think members should be encouraged to take annual leave in excess of the yearly leave they are entitled to whilst they are still sick. If they do not then they will be at real risk of losing this leave entirely. Although it will not interrupt the long term sickness it will still be beneficial to the member as the leave will be at the full rate of pay (rather than sick pay which by this stage is likely to be much less) and will, also, not contribute to Sick pay arrangements.

 

Cases cited:

Plumb v Duncan Print Group Ltd [2015] UKEAT 0071_15_0807

C-44/08 Pereda v Madrid Movilidad SA [2009] ECR I-8405

KHS AG v. Schulte (Case C 214/10) [2012] IRLR 156

Advertisements