Just in time for the summer holiday season the European Court of Justice (ECJ) has held that employees who fall ill whilst on paid annual leave should be able to reschedule those days of the holiday period affected by the illness.
In the case of Anged v Fasga, the ECJ distinguished between paid annual leave and sick leave. The former serves the purpose of enabling an employee to benefit from a period of “relaxation and leisure” whilst sick leave offers a period for recovering from an injury or illness that rendered the person unfit to work.
The Anged decision to allow workers to reschedule paid holiday effected by illness extends a previous ECJ ruling made in Pereda v Madrid Movilidad SA whereby it was held employees who fell ill before, rather than during, a period of planned annual leave, should be permitted by their employer to reschedule the paid annual leave for another time. The decision in Anged now renders the point at which the employee falls ill irrelevant, giving them the ability to re-book annual leave regardless of whether they fall ill before or during their holiday.
The government has estimated that the decision stands to cost UK employers £100m in extra wages each and every year. Understandably many employers have expressed anger at the decision and argue it will do nothing to ease the current nervousness to create positions that exists among many employers.
However, employers are reminded that these ECJ rulings only apply to the four weeks annual paid leave outlined in the European Directive and not the additional 1.6 weeks paid annual leave which is awarded as part of UK legislation.
Further, approximately 45% of the entire UK workforce is only entitled to statutory sick pay (SSP) when absent from work due to illness and under the SSP rules nothing is payable to the employee for the first three days of sickness absence. This will mean that for many workers, forgoing the leave as paid annual leave and requesting it be acknowledged as sick leave will make little sense.
Even where employees are entitled to enhanced sick pay through their employer, more often than not this is offered at the employer’s discretion and is not a contractual obligation.
The majority of employers do not require employees to produce a medical certificate where they are off of work due to sickness for a period of less than a week. However, where an employee returns from annual leave, informs their employer they fell ill and claims all or some of the period as sick leave, employers are advised to request a medical certificate relating to each day of the planned holiday for which they are claiming sick pay. Where employers offer employees over and above the level of statutory sick pay, such an approach is recommended in order to deter abuse. Employers should remember that employees are only eligible for sick pay when they are unfit for work and should approach claims for sick pay whilst on holiday with this in mind. If the illness would not have prevented the individual from working, they are not entitled to claim the period as sick leave.
Employers are advised to alter their employment policies/ handbooks to reflect these changes in the law and outline how sickness and annual leave will be treated.
The Working Time Regulations is the UK legislation which implements the EU Working Time Directive and at the current time these UK Regulations do not allow for workers to reschedule paid annual leave where they have fallen ill during a period of leave, as is now required due to the decision in Anged. As a result the Government is now planning to amend the Working Time Regulations to allow employees this right. Whilst the decision is not currently included in UK legislation Tribunals are obliged to follow these decisions and for this reason employers are advised to consider the decisions made by the ECJ in Anged and Pereda as law, or face having to deal with potentially costly tribunal claims.
David Dixey is Holmes & Hills' Employment Law specialist, offering Employment Law advice for employers and Employment Law advice for employees across the region.
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