Carrying over holiday may be required in circumstances other than sickness

The Working Time Regulations 1998 (WTR) provide for a basic entitlement to a total of 5.6 weeks’ paid annual leave in each leave year, in order to benefit the health and well-being of workers.

Under the WTR, statutory annual leave may not be carried over from one leave year to the next, nor may payment be received in lieu of untaken holiday, except for in respect of any unused holiday on termination of employment.

This “use it or lose it” principle has been subject to just one exception: sickness. In NHS Leeds v Larner the Court of Appeal held that workers who did not have the opportunity to take their holiday entitlement in a particular leave year due to being away from work on sickness absence could carry over any unused holiday to the next year.

However, there has now been a potential widening of this previously very narrow exception. In The Sash Window Workshop v King the EAT agreed with the Tribunal that, in principle, workers may be able to carry over untaken holiday if they were prevented from taking holiday due to “reasons beyond their control”.

Mr King, a commission-only salesman afforded worker status, sought to claim 24 weeks unpaid holiday leave that he had accrued over a 13 year period. Although Mr King took some holiday each year to visit family, he argued that he tried not to take too much as he was not paid for it. The EAT said that the Tribunal should have considered “whether the Claimant was unable or unwilling because of reasons beyond his control, to take annual leave and as a consequence did not exercise his right to annual leave”. However, the EAT found no evidence that Mr King was actually prevented from taking the holiday and the assumption of the Tribunal that Mr King would have been refused the holiday had he asked for it, was rejected. Allowing the appeal, the EAT has remitted the matter to the Tribunal for reconsideration, stating there are currently not sufficient findings of fact to depart from the usual position.

However, arguably, there may be claims where workers may be able to carry over or be paid in lieu for untaken holiday if they haven’t been able to take it for reasons beyond their control. This could prove to be the beginning of a significant widening of the principles operating in this area, and so is certainly one to watch.

Read the full EAT decision here: http://www.bailii.org/uk/cases/UKEAT/2014/0057_14_0112.html