Entitled to Paid Leave

Welcome back to your weekly case law update. Last week we looked at shared parental leave and restrictive covenants. This week we have a case on the right to holiday pay. Unlike most of the cases we cover, this case has been referred to the Court of Justice for the European Union (CJEU). Whilst the decision is to be followed for now, the law may change on Brexit being concluded and the Great Repeal Bill being enacted.

This case is an employment status issue. The question this week is:

Does a worker need to take leave to establish whether they are entitled to be paid for it?

Mr King, the Claimant, had a sales based role with Sash Window Workshop, the Respondent. The Claimant was paid exclusively via commission for his sales and his contract described him as self-employed. The Claimant’s contract did not state whether he was entitled to paid leave and he had not been paid for any leave taken during 13 years’ service.

The Claimant, was dismissed on reaching the age of 65 – something that may be a discrimination issue in itself. On his dismissal, the Claimant brought a claim for unpaid holiday before the ET. The ET allowed the claim, finding the Claimant was a worker and therefore entitled to Holiday Pay.

The Respondent appealed, twice. They argued that the Claimant was not a worker and not entitled to paid leave because he hadn’t taken it. The Court of Appeal referred the issue to the CJEU to determine whether the Claimant needed to take leave before knowing whether he was entitled to be paid for it.

The Attorney General for the CJEU held that if a worker is not given the right to paid leave then that right carries over until they get a chance to take it. It added, on termination, the worker would be entitled to payment in lieu for untaken leave.

The takeaway point:

No, a worker is entitled to paid leave and this will accrue whether they take leave or not. Once again, having silent, or grey, contractual terms will not protect an employer.