July 4, 2012

Employment e-Brief – Holiday and Sickness Absence – The Saga Continues

A further decision by the European Court of Justice (“ECJ”) has been handed down in respect of sickness absence and annual leave. We feel this is highly likely to give employers very real problems if and when employees start to appreciate its relevance, unless employers take active steps to deal with it.

BACKGROUND

Under a collective agreement, in Spain, a worker whose period of annual leave overlapped a period of “temporary disability” could reschedule that period of annual leave to a subsequent date. For the purposes of this collective agreement, “temporary disability” encompassed absences by reason of pregnancy, but made no reference to general absences or “temporary incapacity for work”.

Trade unions challenged this and sought a ruling that if workers, who were covered by this collective agreement, fell ill during the period of paid annual leave, even on grounds of “temporary incapacity for work”, they should be allowed to take that affected paid annual leave later.

The “Tribunal Supremo” made a reference to the ECJ and sought clarification on this point by referring a number of questions.

EARLIER CASE LAW

In the earlier case of Pereda v Madrid Movilidad SA (2009), the ECJ held that where an employee fell ill before commencing pre-arranged annual leave, they should be allowed to rearrange that period of affected annual leave to a later date.

The crux in this new case was: did it matter when the employee fell ill?

DECISION

The court said no, it did not matter. Specifically, the ECJ held that “the point at which that temporary incapacity arose is irrelevant”. Therefore, a worker who fell ill during a period of paid annual leave should be entitled to rearrange that period of paid annual leave; even if this means that it will be carrying it over to the following leave year.

Unfortunately, despite being asked the question, the ECJ did not specifically provide its response to the situation where a period of annual leave was interrupted by a few days of illness and whether the employer in such a situation would then be required to rearrange the whole period of annual leave taken or just the period of interruption. However, the ECJ did state that only periods of illness which overlapped planned annual leave may be rearranged and as such, there is a suggestion that this may be limited to days of illness, but there is no clear guidance on this by the ECJ.

IMPLICATIONS

UK courts are likely to observe this decision.

For employers, it may be a potential headache with employees claiming to be ill in order to receive further paid annual leave. Employers need to consider the measures they need to put in place in order to deal with such instances and more importantly how to uncover and deal with any abuse.

For more information, please contact Philip Paget on 0113 2270212 or any member of the Employment Team.