Advocate General proposes 18-month limit on holiday accrual while on sick leaveFriday, July 15th, 2011
Indefinite accrual of holiday leave and pay while on sick leave is incompatible with the objective of recuperation, according to the Advocate General.
According to case law of the Court of Justice of the European Union (CJEU), the right to annual leave is retained even in cases of long-term illness. The length of time for which this right continues is the issue considered by Advocate General Trstenjak in the case KHS AG v Winfried Schulte, yet to be decided by the CJEU itself. An Advocate General has the role of proposing to the CJEU an “Opinion”, i.e. a legal solution to a case for which it is responsible but the CJEU is not obliged to agree with the Opinion.
Mr Schulte was absent sick from 2002 until his employment was terminated in 2008. Following termination, he made a claim to a German court for payment in lieu of 35 days’ contractual leave for each of the three years 2006 to 2008. The court approved the payment but limited the amount to the statutory minimum entitlement. The employer appealed and the court decided to seek a ruling from the CJEU as to
- whether workers may accumulate entitlement to allowances in lieu of leave over several years, and
- whether Member States may set a time-limit of 18 months for those entitlements.
The Advocate General’s Opinion makes the following points:
- Case-law has established an inviolable right to annual leave even in cases of long-term illness.
- The accumulation, without any time limits, of entitlement to leave or allowances in lieu is not required by EU law.
- The purpose of annual leave is to enable a worker to “recover from the effort and stress of the working year and draw new strength for the rest of the working year from the relaxation and leisure enjoyed while on leave”, and that objective is not achieved if the leave is not taken until a number of years later.
- Faced with having to make payment for leave accumulated over several years, employers are likely to terminate employment of workers quickly.
- A time limit of 18 months, as suggested by the German court, is consistent with the protections built into the Working Time Directive and provides a period of up to 2½ years to take the entitlement for a particular year. However, a period of 6 months would be insufficient.
The Opinion of the Advocate General conflicts with the proposals published by the UK Government in May 2011 to bring the Working Time Regulations into line with EU case law by allowing a limited amount of annual leave entitlement to be carried forward to the next holiday year. However, the CJEU may yet decide that the Advocate General’s proposed 18-month time limit goes beyond the current terms of the Working Time Directive and reach a quite different conclusion.