New case on sick leave and holiday entitlement

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09 November 2011

Employees who fail to request holiday when off sick could now lose their entitlement to holiday pay for previous years.

In Fraser v Southwest London St George’s Mental Health Trust, the Employment Appeal Tribunal has found that Mrs Fraser, a nurse on long term sick leave, was not entitled to carried over holiday pay on the termination of her employment, as she had not requested any holiday whilst off sick.

It was held that she should have given notice to take holiday, in the relevant leave year, in order to be entitled to pay in lieu of that holiday when her employment was ended.

Previous cases had suggested that an employee on long term sick leave would be entitled to holiday pay for previous holiday years, as well as the current leave year, when their employment terminated.

It appears the onus will now be on the employee to take their holiday while off sick or to ask to carry over their holiday entitlement until they return to work. Should it not be possible for the employee to take the requested leave before their employment ends, then the employee may be entitled to pay in lieu.

Also helpful for employers is the EAT’s comment that there is no general duty on the employer to advise the employee of their right to request leave in this way.

While this decision is helpful for employers, as ever with this area of the law, there remains some uncertainty as, in an earlier case this year (NHS Leeds v Larner), the EAT came to a different decision. It seems that both cases may be referred to the Court of Appeal, which would hopefully give some clarity.

In the meantime, this latest decision should allow employers to be more robust in refusing to pay in lieu of holiday when the holiday has not been properly requested in the correct leave year.

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