No, said the Advocate General of the CJEU in King v The Sash Window Workshop (TSSW).

Mr King had been paid entirely on commission. His contract described him as a self-employed salesman. The contract contained no reference to any entitlement to paid leave and he was not paid for any leave taken in the 13 years that he worked for TSSW. Mr King’s contract was terminated when he reached 65, and he brought claims at the ET for age discrimination and holiday pay. 

The ET found that he was entitled to several payments of holiday pay, including a payment in lieu of the accrued – but unrequested and untaken – leave throughout the whole period of his employment (holiday pay). The EAT upheld TSSW’s appeal against the award of holiday pay. The case proceeded to the CoA. The CoA referred the following questions to the ECJ:

•Does a worker have to take unpaid leave before they can establish whether they are entitled to be paid for it?

•If a worker does not take some of their annual leave entitlement because their employer refuses to pay them during annual leave, can they claim that they were prevented from exercising their right to paid leave and carry that right over until they can exercise it?

•If so, does the right carry over apply indefinitely or is there a limited period during which it must be exercised?

•If the right is time limited, is a period of 18 months acceptable? 

The Advocate General’s opinion was that:

•EU law does not require a worker to take annual leave before being able to ascertain whether he will be paid for it

•A worker’s right to paid annual leave carries over until he can exercise it. On termination of employment, the worker has the right to payment in lieu of leave that remains outstanding

•If no adequate facility has been provided to enable a worker to exercise the right to paid annual leave, he has the right to payment in lieu of any leave accrued throughout his full period of employment that remains outstanding on termination of employment

•Time limits should only be imposed by member states on the carryover of annual leave if the worker was provided with an adequate facility to exercise his right to take paid annual leave

The ECJ is not bound to follow the Advocate General’s opinion but, if it does, this case is likely to have significant implications for employers that have withheld holiday pay from workers that they consider to be self-employed.  A worker may now be able to wait until the end of employment, and therefore not put his job at risk, before challenging any failure to facilitate the taking of paid leave. As a result, employers could face an increase in such claims.

For more information, please contact Nia Cooper

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