Loyal readers will note that I blogged on this topic only last week, in the context of taking unused holidays accrued on sick leave at a later date.
The EAT in Fraser v Southwest London St George’s Mental Health Trust dealt with the question of what happens to unused holidays on termination and held that an employee on long term sick leave must (in respect of leave accrued in previous leave years) have actually requested leave to be entitled to payment in lieu of it.
The employee in this case, Ms Fraser, went off on long terms sick in 2005 after suffering an injury at work. Her entitlement to sick pay expired in 2006 and she continued in employment, whilst off sick with no pay. After a limited return to work in 2007, Ms Fraser was dismissed in 2008, after the 2008/2009 holiday year had commenced.
Ms Fraser was paid for her accrued but untaken holiday entitlement in the final leave year (2008/09) but not paid for any holiday in the previous 2 leave years. Ms Fraser brought a Tribunal claim for 4 weeks’ pay in each of those 2 leave years. It was not disputed that Ms Fraser had accrued this leave, but it was argued that she had not given notice at the time that she intended to take her holiday entitlement, under Regulation 15 of the Working Time Regulations 1998. Regulation 15 deals with the mechanics of taking leave, namely that a worker must give notice of their intention to take leave.
The Tribunal held that Ms Fraser was not entitled to paid holiday for the previous 2 leave years on the grounds that she had not given notice of her intention to take holidays. Mr Justice Underhill considered that the Judgment was compliant with the ECJ decision in Pereda noting that an employee on sick leave may request, at that time, that they are paid in lieu of leave or that the leave is deferred until their return. It would then be for the employer to make a decision. The point is that the employee should specifically ask but Ms Fraser did not do this.
This is a useful and employer friendly judgment by the Employment Appeal Tribunal, clarifying a complex point in relation to annual leave accrual on sick leave. Watch this space as I have no doubt that there will be further decisions in relation to this area to come.