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Government Guidance on Holiday and Sick Leave Published
Following the landmark decisions of the European Court of Justice in the Stringer and Pereda cases last year on the rights of sick employees to paid holiday under the Working Time Directive, the Government has issued interim guidance to business ahead of beginning a consultation exercise later this year on possible amendments to the Working Time Regulations.

The combined effect of the rulings is that a worker can chose to take their statutory annual leave at the same time as sick leave, or the worker can chose to take the missed annual leave at a later date. A worker who has missed out on statutory annual leave due to sickness, may be able to carry-over the missed leave to the next leave year.

The Department for Business Innovation & Skills (BIS) will be consulting on possible amendments to the Working Time Regulations in light of the ECJ ruling. In the meantime, they have issued the following guidance:

Guidance for employers
A worker continues to accrue their statutory minimum holiday entitlement as normal while absent from work due to sickness, however long the period of sickness may be. Depending on the terms of their employment contract, they may also accrue any additional contractual annual leave that they would normally be entitled to.

In light of the European Court of Justice (ECJ) judgments, a worker on sick leave is entitled to take statutory annual leave at the same time, if they wish. If a worker makes this choice, you would have to pay them their normal holiday pay rather than company sick pay - or their normal holiday pay rather than no pay if their company sick pay period has ended - for the days that he or she wishes to treat as annual leave.

If the employee qualifies for statutory sick pay (SSP), you would carry on paying the worker SSP during the time on annual leave and count this sum towards the amount of holiday pay you would be making. To take annual leave at the same time as sick leave in this way, is clearly a choice a worker is most likely to make if they either:

* are on sick leave for a considerable period, and has run out of sick pay
* will be unable to take all the annual leave to which he or she is entitled on return to work shortly before the end of a leave year
* have no entitlement to contractual sick pay

If a worker becomes sick whilst on or just before they are due to take annual leave, they can choose to have the time off that they are sick changed to sick leave. They can then make arrangements to take the annual leave that they missed at a later date.

In these situations a worker will then be on sick leave. You will want to consider requiring evidence of their sickness in line with your usual sickness absence procedures and inline with any eligibility criteria for company sick pay. For example, to qualify for full pay whilst sick a worker could be required to inform you as soon as they reasonably can that they are sick and you could request medical evidence.

If a worker is unable to take all of their statutory holiday entitlement within a leave year because of illness, the ECJ judgment also means they may be entitled to carry forward the unused statutory entitlement to the next year.
Posted on 19 Nov 2016

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