Two recent cases have shed some helpful light on the implications of the decision in Stringer and ors v HMRC which established that holiday pay continues to accrue while employees are on long term sick leave and are entitled to be paid for it.
First, in KHS AG v Schulte  EUEJC C214/10 the European Court of Justice has confirmed that it is permissible for member states to impose a cut-off on the carry forward of unused holiday allowances for employees on long term sickness leave. In the particular German case the cut-off under the relevant collective agreement was 15 months, but the opinion of the Advocate General given in August suggests that on the same principle a cut-off period of 18 months (as recommended by the International Labour Organisation) would also be acceptable. This will no doubt be taken into account in the amendments needed to the Working Time Regulations to reflect the earlier decisions on accrual.
The second case, Fraser v Southwest London St George’s Mental Health Trust (EAT, 3rd November 2011), is an Employment Appeal Tribunal (EAT) decision dealing with the right of employees on long term sick leave to be paid accrued sick pay. The facts concerned a nurse who was off sick for a lengthy period and made a claim for holiday pay accruing while she was absent. The EAT upheld a tribunal decision rejecting her claim, because the Working Time Regulations require employees to request leave, which she had not done. Consequently, where an employee continues in employment, but is absent on sick leave for the whole of a leave year, if he or she wishes to be paid for the statutory entitlement to holiday which has accrued during the year, then he or she must put in a request for the holiday in the normal way. As EAT President Underhill pointed out, while this may mean requesting holiday when the employee would not have been at work anyway, if entitlement to contractual sick pay has been exhausted, this may be an attractive option for the employee.
Both of these decisions are helpful to employers, first by clarifying how the Stringer case should be interpreted, and, more immediately, in limiting its scope.