Sood v Healy: long term sick leave and holiday entitlement

Regular attendees to our update seminars will be aware of this long running issue.

To recap, the legal rules concerning minimum holiday entitlement stem from a European Directive, which has been implemented in the UK by the Working Time Regulations 1998. To understand this case, it is important to appreciate that the European Directive only requires EC countries to grant a minimum of 4 weeks annual leave per year (20 days for a full time worker); anything over this is at the discretion of national governments. In the UK, our governments have been more generous and granted a further 1.6 weeks’ leave, giving 5.6 weeks in total (equating to 28 days per year for a full time worker).

A series of European cases have brought us to the point where it is settled that holidays continue to accrue when a worker is on long term sick, meaning that they have the holidays left to take upon their return to work (or the right to be paid for them if their employment is terminated). This applies even where the worker has to carry the holidays over into a new holiday year because they are unable to take them in the year when they accrue.

In the latest development, the Sood vs Healy case has clarified that the right to automatic carry over of holidays only applies to the European minimum of four weeks’ annual leave unless there is an agreement that more can be carried over. In other words, unless the employer has specifically agreed (for example in its contracts or staff handbook) the additional 1.6 weeks given under UK law cannot be carried over.

What this means for you
Unless you have explicitly granted the right to carry all accrued holidays over then there is nothing you specifically need to do except to be aware of this case, but check again at the time if you think this may affect you. This topic remains as controversial as ever and further developments cannot be ruled out!

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