Further ECJ ruling on carry over of annual leave and sickness

The ECJ have delivered a body blow to employers already reeling from the Stringer decision, by reconfirming that the Working Time Directive does not prevent national legislation or practices allowing a worker to take annual leave during sick leave, and then going one step further by holding that where that worker does not wish to do so the annual leave must be granted in a different period, if necessary outside the annual leave period. Jane Wallenstein explains more.

25/09/2009

Jane Wallenstein

Jane Wallenstein

Associate

In this article...

The ECJ have delivered a body blow to employers already reeling from the Stringer   decision, by reconfirming that the Working Time Directive does not prevent national legislation or practices allowing a worker to take annual leave during sick leave, and then going one step further by holding that where that worker does not wish to do so the annual leave must be granted in a different period, if necessary outside the annual leave period. Jane Wallenstein explains more.

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The Facts

The case in question is that of Pereda v Madrid Movilidad SA . Mr Pereda (P) was employed by Madrid Movilidad SA (MMSA) to remove wrongly parked cars from public highways. In 2007, in accordance with MMSA’s planned leave schedule, which was drawn up in accordance with the collective agreement for 2006 - 2009 and with the leave proposal submitted by the works committee he was allotted a period of annual leave to be taken between 16 July and 14 August.

Unfortunately P had an accident at work on 3 July and was unfit to work until 13 August 2007. As a result of this, on 19 September 2007 P asked MMSA to allocate him a new period of paid annual leave which he wanted to take between 15 November and 15 December 2007, as he had been sick during the original period.

MMSA said no, without giving any explanation and P challenged the refusal in the Spanish Court of First Instance.

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The referral to the ECJ

The Spanish Court asked the European Court of Justice (ECJ) to determine whether Article 7(1) of the Working Time Directive which provides that:-

“Member states shall take the measures necessary to ensure that every worker is entitled to paid annual leave of at least four weeks in accordance with the conditions for entitlement to, and granting of such leave laid down by national legislation and/ or practice.”

must be interpreted as meaning that when the period of leave allocated in the undertaking’s annual planning of leave coincides in time with a temporary disability following an accident at work which happened before that period of leave began, the employee affected, once he returns to work, has the entitlement to use his leave on dates different from those originally allocated, irrespective of whether the calendar year to which they relate has ended.

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The ECJ decision

The ECJ said that it did.

In giving their decision they made it clear that Article 7(1) does not preclude as a rule, national legislation which lays down conditions for the exercise of the right to paid annual leave expressly conferred by the directive, including even the loss of that right at the end of a leave year or of a carry-over period, provided, however that the worker who has lost his right to paid annual leave has actually had the opportunity to exercise that right.

They went onto to hold – and here is the body blow – that the right to paid annual leave is not extinguished at the end of the reference period laid down by national law where the worker was on sick leave for the whole or part of the leave year and had not actually had the opportunity to exercise that right.

The Court held that while the positive effect of paid annual leave for the safety and health of the worker is deployed fully if it is taken in the year prescribed for that purpose, namely the current year, the significance of that rest period in that regard remains if it is taken during a later period. Consequently where a worker does not wish to take annual leave during a period of sick leave, annual leave must be granted to him for a different period even if that falls outside the corresponding reference period.

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Practical effects

This case seems to suggest therefore that an employer cannot compel an employee, who is on long term sick leave, to apportion a period of that sick leave as annual leave (and be paid in full for it).

This will make it even harder for employers to deal with the already difficult issue of annual leave for employees on long term sick leave and could lead to situations where employees who have been absent for some years return to work with many months of accrued annual leave ‘in the bank’.

Given the scope for abuse by employees, it seems reasonable for employers to require workers to provide evidence of their illness whilst on holiday and that it would have made them unfit for work.

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