Sickness or holiday?

Recent cases, particularly Fraser v Southwest London Saint George’s Mental Health Trust, make it clear that employees on an extended period of sickness can choose to take some of that sickness as holiday.

This has always been a grey area. It can reasonably be argued that taking a holiday break during illness can aid recuperation. Where an employee is on occupational sick pay it may not make any difference to their pay. But some employers are sensitive to employers jetting off for a holiday in Florida while being paid sick pay. Perhaps even more so if the employee also demands fully paid holiday, when in due course, they return to work.

In a previous blog we looked at the relationship between holiday and sickness. It is the case that an employee who is off sick will still accrue holiday entitlement. An employee who is sick while on holiday can substitute that holiday for sickness pay and take the holiday at a later date. Those are the fundamental rules although there are complications in practice. For example, four weeks holiday arises from European legislation whereas the extra 1.6 weeks comes from UK legislation. Interchange between the two legislatures creates complications. Also, of course, you can require the same sickness reporting procedures for an employee who is sick on holiday as you would require when he or she was at work.

But the latest case means that where a sick employee (or worker) makes a request for annual leave whilst on sick leave, then you have two options:

1. allow them to take annual leave when off sick (which workers who have finished their entitlement to contractual sick pay may choose to do), or

2. allow them to take the leave on their return to work, even if this means it must be taken in a subsequent leave year.

The guideline to how long leave may be carried forward comes from a European case: KHS AG v Schulte. Here it is suggested that 15 months is reasonable, although employers might like to leave a margin, say 18 months.

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