Public and Commercial Services Union

DWP/BB/048/09

European Court of Justice ruling

The European Court of Justice (ECJ) ruling of 20 January 2009 on the accrual of annual leave during sickness absence impacts on the DWP’s annual leave policy.

In Stringer and others v HMRC the ECJ held that, under the Working Time Directive:

• Employees accrue the right to paid statutory annual leave while on sick leave (paid or unpaid);
• Employees who are on sick leave for all or part of their annual leave year and who therefore do not have the opportunity to take their annual leave must be allowed to carry it over to the next leave year (to take when they return to work);
• If employment is terminated, the employee is entitled to be paid for their untaken annual leave.

The ruling applies to the 20 days statutory annual leave provided by the Working Time Directive at the time the case was heard.

Impact on DWP annual leave policy

DWP is discussing the impact of the ECJ ruling with the departmental trade unions but agreed to issue interim HR guidance on 9 April 2009. With effect from 20 January 2009, DWP guidance is as follows:

Carry over of statutory annual leave following sick absence

The department’s annual leave policy says that employees can carry over 14 days annual leave on return from long-term sick absence.

As a result of the Stringer case, employees will now be able to carry over 20 days statutory annual leave (or the untaken part of it if leave was taken before the sick absence) on their return to work.

The normal arrangements for authorising absences, which balance the employee’s and the business’ needs, will apply.

Payment for untaken statutory annual leave when leaving the department

Employees are entitled to payment for any untaken annual leave (including statutory annual leave) on leaving the department.

If an employee is on sick leave on their last day of service, statutory annual leave will accrue up to the last day of service.

This overrides paragraph 13.3 of the annual leave policy and paragraph 7.2 of the sick leave procedures.

Further guidance will be issued when discussions are completed with DWP.