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Holiday pay: No entitlement for those on more than 12 months' sick leave

This report relates to 1 case(s)

Key points

In Commissioners of Inland Revenue v Ainsworth and others, the Court of Appeal holds:

  • Workers absent through long-term sick leave who have exhausted their entitlement to sick pay are not entitled to four weeks' holiday pay when they have done no work during the leave year. This would give them an unjustified windfall not intended by the Working Time Regulations 1998. The Court of Appeal overruled the EAT's decision in Kigass Aero Components Ltd v Brown [2002] IRLR 312.
  • Workers whose employment is terminated after 12-month periods of absence through sickness are not entitled to payment for holiday pay for "leave" they have not taken while away from work on sick leave.
  • Claims to enforce the right to annual leave and holiday pay must be made under the Working Time Regulations 1998, rather than under the Employment Rights Act 1996 ("ERA") as unauthorised deductions from wages. The Court of Appeal overruled the EAT's decision in List Design Group v Douglas [2003] IRLR 14.