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Holiday is not taken due to sickness: Can the employees’ entitlement be carried over to next year?

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The cases of Stringer and others v HM Revenue and Customs and Pereda v Madrid Movillad SA established that if holiday is not taken due to sickness, an employee should be allowed to carry that holiday entitlement forward to the next leave year.

In the Pereda case, the European Court of Justice went further to say that where an employee has booked time off work as annual leave but is then absent from work due to illness during that period, the worker should be able to take that holiday later in the year, or, if that is not possible, they should be permitted to carry it over to the next leave year.

The Employment Tribunal has now decided, in Shah v First West Yorkshire Limited, that the UK legislation governing holidays, the Working Time Regulations, should be interpreted so as to give effect to the decisions in Stringer and Pereda.

The Tribunal found that Mr Shah, who broke his ankle and was off work because of this injury during a period of pre-booked holiday absence, was entitled to take this holiday at a later date.

Furthermore, as his injury prevented him from returning to work until the next leave year, he was entitled to carry this holiday over to the next year.

This is the first time that the issue of sickness during annual leave has been tested at the Employment Tribunal since the decisions in Stringer and Pereda. As it seems likely that Tribunals will apply this decision and take a similar stance in the future, employers may wish to review their holiday and sickness policies to make sure that they are compatible.

For more information, please contact our Employment & HR team on 01332 340 211.

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