I blogged on this topic a couple of months ago in light of the EAT’s decision in NHS Leeds v Larner [2011] IRLR 894, where it was held that an employee who had been absent for medical reasons during an entire holiday year was entitled to take her unused holidays at a later date. As I mentioned, the approach of the EAT in that case followed that of the ECJ in Stringer v HMA and Pereda v Madrid Movilidad SA.

The issue has now been given further consideration in a recent case which has come before the Employment Tribunal, Adams and another v Harwick International Port Ltd ET/1503084/10 and 1503085/10.

Mr Adams and Mr Hunwick were both employed by Harwich International Port Ltd. Each of them had had prolonged periods of sickness absence, with Mr Adams’ absence extending over two calendar leave years. While off sick, neither of them had taken or asked for any annual leave. They later requested to take the annual leave which had accrued during their sickness absences but Harwich International declined this. The employees contended that this amounted to a refusal to permit them to exercise their rights under the Working Time Regulations 1998 and brought Tribunal proceedings.

The Tribunal considered that it was possible to interpret the Working Time Regulations as meaning that while leave may only be taken in the leave year in respect of which it is due, this is subject to an exception where the leave “accrues during a period of sickness absence and the worker is unwilling or unable to take it concurrently with sick leave and unable…to take it before the expiry of the leave year in which the sick leave ends...”

Accordingly, the Tribunal found that both employees were entitled to carry forward their accrued untaken leave to the immediately following year. The Tribunal did though state that it was not persuaded that the right to carry forward such untaken annual leave should be open-ended and therefore capable of being carried over from year to year indefinitely.

Although this is only a decision of an Employment Tribunal and therefore not binding on other Tribunals, the judgement in this case provides further clarification for employers of how they should deal with accrued annual leave of employees who are absent due to sickness. According to the judgement, sick workers will be entitled to carry over to the following leave year their annual leave entitlement, not only in respect of the four weeks provided for under Regulation 13(9), but also in terms of the additional 1.6 week entitlement. This is slightly surprising and it may be that the Employment Appeal Tribunal will clarify this point at a later date.

It will also be interesting to see whether the Government is persuaded by this approach given their current proposals for reform of the Working Time Regulations which would allow sick workers to carry over annual leave in respect only of the 4 week period.