News & Views

Holidays and sick leave (again)

BY Fiona McBeath
Employment law
BG Purple

Given the saga that is the question of entitlement to annual leave accrued during sick leave, we seem at last to have an answer to the question: How much leave can be carried over from one year to the next?

The EAT has confirmed employees can only carry over up to four weeks’ leave, if illness prevents them taking it.

'Statutory annual leave’ comes from the Working Time Regulations 1998 which implement the EU’s Working Time Directive. The Directive states that a minimum of four weeks’ (20 days’) paid annual leave should be given to all workers. However, the UK’s Regulations extend this to 5.6 weeks (28 days).

The Regulations also specifically state that four weeks’ leave (the period specified by the directive) can only be taken in the holiday year to which it relates and cannot be carried over to the next leave year; but the additional 1.6 weeks’ leave can be carried over if the employer and worker agree to this. 

A string of cases dealing with employees on long term sick leave has clarified the position. The cases confirm that employees on sick leave should be allowed to carry over any outstanding leave to the next holiday year if they have been unable to take it due to sickness. But the question of just how much leave could be carried over has been left unanswered until the recent EAT decision in Sood Enterprises v Healy.

The Employment Tribunal decided that Healy should be paid for all his accrued holiday and that the additional 1.6 weeks’ leave could be carried over. 

On appeal, the Employment Appeal Tribunal decided that Healy was not allowed to carry over the additional 1.6 weeks’ leave. The EAT commented that the Regulations expressly dealt with this situation by stating that the 1.6 weeks’ leave can only be carried over if employer and employee agree to this. In Healy's case, there was no such agreement.

This case confirms that employees on long term sick leave can only carry over up to four weeks’ holiday if they have been unable or unwilling to take it in the leave year in which it accrued. The employee does not need to make a request to do this.

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