From 1 August 2015 employees will accrue statutory annual leave while on certified sick leave (subject to a maximum carry-over of 15 months from the end of the year in which it accrued).
Irish legislation is now in line with current European law on this point which means that employees working in the private sector in Ireland can now accrue statutory annual leave while on certified sick leave.
Previous Position in Ireland:
In 2009 the Court of Justice of the European Union (the “CJEU”) decided that under the 1993 EU Working Time Directive employees are entitled to accrue annual leave while on sick leave and to take such accrued annual leave after their sick leave has ended.
The CJEU later clarified that national law could provide that annual leave accrued while on sick leave is subject to a maximum “carry-over” period of up to 15 months from the end of the year in which it accrued.
These European decisions were at variance with the Organisation of Working Time Act 1997 (the “1997 Act”), which implements in Ireland, the 1993 EU Working Time Directive.
The 1997 Act, provides that an employee is entitled to a minimum of four working weeks’ paid annual leave where the employee has worked at least 1,365 hours in a leave year. It also provides that annual leave was calculated on the basis of time worked and was silent on the issue of how time spent on sick leave should be regarded for the purposes of calculating annual leave. The view was taken in Ireland that time on sick leave was not time worked and accordingly annual leave did not accrue for periods of sick leave.
The Workplace Relations Act 2015
The Workplace Relations Act 2015 amends the 1997 Act to provide that an employee will accrue statutory annual leave while on certified sick leave. However, such accrued annual leave must be taken within 15 months of the end of the annual leave year in which it accrued or the leave lapses. Alternatively, if the employment ceases the employer must pay the employee in lieu of the accrued untaken annual leave.
Employers should amend their relevant HR policies to reflect this change and implement a system to keep track of the statutory annual leave accrued by employees on sick leave from 1 August this year.