Employment Law Advocates

There has already been a great deal of discussion about the decision of the European Court of Justice in Pereda v Madrid Movilidad, in which it was held that workers who become sick while on holiday can reclaim their supposedly lost annual leave to be taken at a later date. Not surprisingly, much of the commentary has focused on the fact that this may allow some people to abuse the system, especially given the well-known sickness-inducing properties of sangria. In the past, I have largely been willing to defend Luxembourg on the holiday pay issue, and I had nothing to say in criticism of the controversial decision in Stringer v HMRC earlier in the year. However, I do agree that it has gone too far this time.

What is frustrating is that the court ruled on an issue that was not before it to be decided, in saying that not only can holiday be taken at a later date, but also that it can be rolled over if it is not practicable to take it in the same leave year. This upset the delicate balance established in Stringer, which appeared to give member states a choice between allowing employees to take holiday while off sick, and allowing untaken holiday to roll over from one year to the next. The former choice suited the United Kingdom rather well because the Working Time Regulations expressly forbid leave from being carried over from year to year and, in retrospect, it is even more unfortunate that the House of Lords did not expressly endorse this option when it had the chance to do so. Pereda has now thrown a spanner into the works.

Because of the minor possibility that a worker might become sick while on holiday, it appears that it is no longer lawful for member states to have a blanket ban on carrying leave over, with the result that the Working Time Regulations are incompatible with European law. This must have been contemplated by the ECJ who, in Stringer, appeared to be so sensitive to differences between member states in the implementation of the Working Time Directive. It is entirely disproportionate that the government will have to draft new regulations in order to deal with this piece of trivia. In recent posts, I have discussed the importance of tribunals making careful decisions on remedy when a lot of money is at stake but this case will do the opposite and introduce an unnecessary level of complexity into small value claims. I have already had a one-hour hearing relisted for a whole day and this will now inevitably be repeated.