Holiday Compensation

The European Court Of Justice (ECJ) is ruling on a case which will determine if a UK salesman is entitled to claim compensation after he was unable to take his full holiday entitlement over a 13-year period.

The employee had worked as a salesman on a “self-employed” basis since 1999. He was paid on commission and his contract with the company did not mention paid leave. Although he did take time off during his tenure with the company, typically a couple of weeks a year, he was not paid during his holiday.

In 2008, the company offered him an employee contract, but he opted to stay self-employed and continued to do so until he was dismissed by the business in October 2012, on his 65th birthday.

In December 2012, he brought a case for unfair dismissal, including a complaint that he was entitled to pay for holiday he had not taken, to a UK employment tribunal. It found that he had worker status and as a worker, he was entitled to paid holiday under the EU’s Working Time Directive.

A subsequent Employment Appeal Tribunal decided he was entitled to carry over paid holiday, or receive it in lieu on termination and the employer remitted the case to the Court of Appeal which said that, where an employer had not provided a worker with the leave they are entitled to under law, that worker’s right to paid leave can be carried forward until a time when it would be reasonable for them to take it. Where the worker’s employment is terminated before the leave is taken, the worker has a right to payment in lieu for any leave outstanding.

This opinion is not yet binding and is being considered by the ECJ so it remains to be seen how the ECJ will rule and what the implications will be on workers who may feel that they have a backdated claim.

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