As reported previously, the Working Time Regulations 1998 (WTR) as they currently stand are not in accord with recent decisions of the European Court of Justice (ECJ) on the interpretation of the Working Time Directive with regard to the interaction of annual leave entitlement with absences from work on account of sickness or maternity, adoption, parental and paternity leave. The effect of the ECJ judgments is that if a worker is unable to take their annual leave during the leave year for one of the above reasons, they should be allowed to reschedule or carry forward to the next year any untaken leave.
The Government is therefore proposing to make the necessary changes to the WTR as part of its ‘Modern Workplaces’ consultation. The proposals are:
- to allow workers to carry forward the statutory 5.6 weeks’ entitlement to paid holiday per year in maternity, adoption, parental or paternity leave (including additional paternity leave) cases;
- to restrict to four weeks per year (the minimum annual leave entitlement under the Directive) the amount of annual leave that can be rescheduled or carried forward in cases involving sickness absence;
- to enable employers to take into account business interests when rescheduling annual leave untaken due to sickness or family-related leave, giving them some scope to require leave to be carried over to the following leave year;
- to enable employers to insist that leave which is untaken due to sickness absence must be taken in the current leave year, where possible, rather than being carried forward;
- to provide additional flexibility by enabling the employer to require a worker to defer 1.6 weeks’ leave until the following year where this can be justified in cases of overriding business need; and
- to allow employers to ‘buy out’, subject to agreement, the additional entitlement of up to 1.6 weeks of leave which go beyond the four-week entitlement laid down by the Directive.