Update to Holiday Entitlement Accrual During Long Term Sickness

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Thanks to the EMW Employment Team for updating us on the latest position regarding holiday entitlement accrual during long-term sickness. The Employment Appeal Tribunal (“EAT”) has provided clarification on an employee’s entitlement for annual leave under the Working Time Regulations 1998 (“WTR”) when off work on long-term sick leave. In Fraser v St George’s NHS Trust it was held that a worker on long-term sick leave would need to request annual leave in line with the requirements of the WTR in order to be entitled to be paid for it. Therefore, despite a worker being entitled to be paid in lieu of accrued but untaken holiday, when their employment terminates, they will only be entitled to pay in respect of leave accrued during the year in which their employment terminates. Accrued but untaken leave from previous leave years will not be able to be carried forward where there has been no request made by the worker to do so. The employer has no duty to notify and make a worker aware that the WTR operate in this way, and therefore it is solely up to the employee to provide any such notice regardless of their awareness of their entitlements. This case has therefore illustrated that employers facing holiday-pay claims from workers on long term sick will not be obliged to pay them unless the worker requests for the annual leave to be carried forward each leave year. Although requiring such a request from an employee on sick leave seems to be artificial, seeing as they are not even present at work, the EAT’s view is that it “merely reflects the artificiality of a period of long term sickness counting as holiday at all”.

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