Pereda v Madrid

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Holiday pay is often a tricky issue for employers and one which seems to be changing constantly. In the light of several new cases discussing holiday pay which have been reported over the summer and in the last couple of weeks, we take the opportunity to round up the legal developments, and set out five things employers should know before deciding how much holiday pay an employee may be entitled to on termination of their employment.Continue Reading Holiday pay – five things you should know when calculating holiday pay

In Pereda v Madrid Movilidad SA, the European Court of Justice (“ECJ”) has decided that where a worker is sick during a period of pre-planned annual leave, annual leave must be granted to him for a different period and if he is prevented from taking it during the current holiday year, he can carry it forward to the next one. This judgment follows on from the recent and highly publicised conjoined cases of Schultz-Hoff and Stringer, which established that a worker on sick leave accrues annual leave whilst off sick but it is for Member States to decide whether a worker can take their annual leave during a period of sick leave. The upshot of these decisions appears to be that employees can choose to do what suits them best – if on long term sick leave, they can elect to take paid annual leave, but if they are sick whilst on paid annual leave, they can elect to postpone paid annual leave and take it later even if that means having to postpone it to the next holiday year. Pereda represents a very worrying development for employers as it opens the door to abuse because unscrupulous employees will be able to re-classify parts of their holiday as sick leave on their word alone.
Continue Reading Workers entitled to postpone annual leave if they fall sick