Hot on the
heels of the Employment Appeal Tribunal (EAT) ruling that means compulsory
overtime must be included in holiday pay calculations when considering ‘normal
remuneration’, a second decision has extended the principle relating to the
conditions under which a worker is entitled to carry leave over into the
following leave year.
The Court of Appeal ruling in NHS
v Larner set out that where a worker is unable to take their leave due to
sickness they are able to carry the leave over into the next holiday year. In The Sash Window Workshop Ltd v King the
EAT has ruled that a worker may
carry leave forward where unable or unwilling to take the leave “because of
reasons beyond his control”.
Mr King was a
commission-only salesman who worked for the employer from 1999 until he
was dismissed in 2012. He had taken time away from work
each year but was not paid for this holiday. He claimed that he would
have taken more time off had it not been for the following factors:
- he had to give notice to the
employer of when he wished to take leave to ensure there were not too many salesman away at one time;
- he had to work to get
commission and so was reluctant to take leave periods for which he would
not receive it; and
- he was unaware of his
entitlement to holiday pay.
At the employment tribunal it was ruled that he was entitled to bring a claim of unpaid holiday pay for the whole period of his
employment, as an unlawful deduction from wages claim on a continuing
basis. But the EAT allowed the employer’s appeal, concluding that the tribunal had not asked the essential
question of whether Mr King had been
prevented by circumstances beyond his control from taking paid leave; it had
merely assumed that he was unable to take it because it would have been refused
by the employer if he had asked for it.
What sets the ruling apart is the acceptance by the EAT that the carry forward of holiday could potentially
apply in non-sickness cases. The effect of NHS v Larner was to
require words to be read into the Working Time Regulations overriding the
“use it or lose it” presumption in sickness absence cases, with the
result that unused leave cannot be carried forward “save where the worker
was unable or unwilling to take it because he was on sick
leave”. The Sash Window Workshop Ltd v King suggests
that this could be drawn more widely to read unable or unwilling
“because of reasons beyond his control”. The EAT set out
that the tribunal should ask the question what would have happened had the
claimant asked for leave – was the worker prevented from taking it or did they
simply decide not to?
This case and the other recent ones that have created layers of
interpretation to the Working Time Regulations will be analysed at Lawspeed’s
forthcoming ‘Knowledge is Power’ seminar taking place on Wednesday 14th January 2015.