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Employment Law

Legal guidance - compliance - software

17 JUL 2015

Can you carry over holiday pay when off sick?

Helen Hughes
Solicitor, Veale Wasbrough Vizards

The Employment Appeal Tribunal (EAT) has held that workers on sick leave are not required to prove that they weren't able to take the holiday due to their medical condition in order to carry over unused statutory holiday in to the next leave year, merely being off on sick leave is sufficient. The EA also held that the right to carry over holiday is not unlimited.

In Plumb v Duncan Print Group Limited, Mr Plumb worked as a printer for Duncan Print Group Limited (Duncan Print). However, following an accident, he took four years' sick leave from April 2010 to February 2014. On termination of his employment, Mr Plumb requested payment for his accrued annual leave for 2010. Duncan Print determined that Mr Plumb was only entitled to the holiday accrued in the current leave year (2013/2014) and only paid him as such.

Mr Plumb brought a claim for payment of the remaining untaken holiday to the Employment Tribunal (ET). The ET dismissed the claim holding that, in the absence of any medical evidence showing that he was physically unable to take the leave, the accrued leave in the previous leave years could not be carried over and had lapsed.

Mr Plumb appealed to the EAT arguing that sick workers should not be required to show that they were unable to take the leave in order to be able to carry it over to the next leave year and that there is no limit under UK law on the period for which leave can be carried over. The EAT held that, considering European law, workers on sick leave should not be required to prove that they are unable to take annual leave due to their medical condition in order to carry over that leave, the fact they are on sick leave is sufficient. UK law should be interpreted to this effect.

The EAT also held that annual leave cannot be carried over indefinitely and that the amount of time in which to carry forward annual leave may be limited to 18 months from the end of the leave year in which the leave accrued. The EAT confirmed that this limit should be read in to the provisions of the Working Time Regulations. As a result, the EAT found that Mr Plumb was entitled to payment in lieu of holiday entitlement for the 2012/2013 holiday year but not for 2010 and 2011.

Best practice

It should be noted that permission to appeal to the Court of Appeal was granted to both parties.

This decision provides certainty that leave accrued during sick leave cannot be carried over indefinitely, subject to any appeal. Rather, annual leave can only be carried over for up to 18 months from the end of the leave year in which the leave accrues where workers are unable or unwilling to take the leave because of sick leave.

Given the length of time the employee in this case was on sick leave, this case also highlights the importance of effectively managing employees on long term sick leave from an early stage.
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