Following the recent High Court Case new proposals in relation to JLC/REA's have been made by the government:
24-Nov-10 at 18.17 | Resolve HR Admin
Following today's decision to reduce the Minimum Wage rate to €7.65. The Government has signalled that the ERO and REA rates should be reviewed. In particular the Catering,...

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Feb 23, 2009

European Court of Justice Ruling on Sick Leave


Currently under Irish law, the employer determines when annual leave is to be taken. Currently Irish Employees are entitled to annual leave as follows:

 

1. Four working weeks leave, in any leave year in which he/she works at least 1,365 hours: or
2. One third of a working week for each month in the leave year in which he/she works at least 117 hours: or
3. 8% of the hours he/she actually worked in a leave year up to a maximum of four working weeks.

 

This means that when an employee is sick for the entirety of the leave year, they are not entitled to any annual leave, as they did not qualify under any of the above criteria for any leave time.

However a recent ruling of the ECJ may change this situation. In the joined cases of Schultz-Hoff –v- Deutsche Rentenversicherung Bund and Stringer and Others –v- Her Majesty’s Revenue and Customs, the ECJ has made the following findings:


1. Annual leave must continue to accrue during sick leave, but the State is not prevented from legislating that the leave may not be taken during the period of absence on sick leave.
2. An employee who has not had to opportunity to take the leave cannot have the leave extinguished, even if any carry forward period has expired.
3. Employees who have not taken their annual leave are entitled to be paid in lieu for this leave at the time of their termination at their normal remuneration rate.

This case is likely to have major implications for Member States and for Employers. Many businesses (both Public and Private) have employees on long term sick leave, however these employees are now likely to claim back holiday pay! To reduce the potential impact of this ruling, employers should:

1. Proactively manage all sickness and absence.
2. Ensure that employment contracts provide that contractual leave over and above the statutory minimum does not accrue during sick leave, and that in any leave taken by the employee the statutory leave is deemed to be taken first.
3. Ensure those employees on long term sick leave are terminated (using fair procedures), rather than continuing to stay “on the books”.