Are Employers Obliged to Carry Over 'Additional' 1.6 Annual Leave When a Worker is Ill?
The Court of Justice of the European Union (the “CJEU”) held in TSN v Hyvinvointialan that an employer is only obliged to carry over the 4 weeks annual leave entitlement provided for in the Working Time Directive (“WTD”) and not any ‘additional’ leave under domestic law when the entitlement is not taken due to sickness absence.
As you will be aware under UK law a worker is entitled to 5.6 weeks' annual leave in each leave year. This is made up of:
- Four weeks’ annual leave under the Working Time Directive (“WTD leave”); and
- The domestic right to an additional 1.6 weeks' annual leave, representing UK public holidays (“Additional leave”).
The Working Time Regulations (“WTR”) confirms that WTD leave must be taken in the leave year to which it relates, or else it is lost. Additional leave may be carried forward into the next leave year in accordance with a relevant agreement.
In this case, two workers were entitled to leave in excess of their WTD leave and they were both unable to take all their leave in one year due to sickness absence. The CJEU was required to consider whether national rules preventing carry-over of more than 4 weeks' leave were permissible.
In reaching its decision the CJEU confirmed that annual leave entitlement beyond WTD leave is not governed by the WTD. Therefore, the WTD did not preclude national rules or collective agreements which allow workers entitlement in excess of the minimum period of 4 weeks and yet exclude the carrying over of those days of leave on the grounds of illness.
This can be seen as welcome news for employers as in the absence of any contractual agreement workers will not be entitled to carry over more than 4 weeks’ leave providing employers with greater flexibility.
This bulletin is for general guidance only and should not be used for any other purpose. It does not constitute, and should not be relied upon as, legal advice.
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