Pereda v Madrid Movilidad SA C-277/08

Where a worker’s pre-arranged annual holiday leave coincides with a period of sick leave the worker must have the option to designate an alternative period for the exercise of his or her right to annual leave. Thus if an employee is ill whilst on holiday it does not count towards the minimum period of 4 weeks’ paid annual leave under the Working Time Directive.

Mr Pereda, a driver, suffered an accident at work around 14 days before his 4 weeks’ annual leave. The injury put him out of action for 6 weeks. His sick leave therefore almost entirely overlapped his planned holiday but his request for an additional period of annual leave was refused. Under the ECJ’s ruling his period of sick leave should not have counted towards his holiday time.

This ruling emphasises that there can be no derogation from the entitlement to paid annual leave, the purpose of which is to enable the worker to rest and enjoy a period of relaxation and leisure. By contrast, the purpose of entitlement to sick leave is to ensure that the employee can recover from being ill. Thus if a worker decides not to take annual leave during a period of illness he must be granted a replacement holiday period to ensure that he is not deprived of his entitlement to rest, relaxation and leisure.

Key point: Employers should review their current holiday leave policy and terms in light of this case.