European Court advises on worker holiday entitlement

News Article

The European Court has advised on the rights of workers to holiday leave which, if upheld, could lead to significant costs for so called ‘gig economy’ employers.

In an opinion about a case involving a UK window salesman, the Advocate General of the European Court of Justice has reiterated employees’ rights to paid leave or alternatively financial compensation if they are not allowed to take their holidays.

The ECJ heard how, in the case of King v the Sash Window Workshop Ltd, salesman Mr King launched a claim for £27,000 worth of holiday pay, accrued over a 13 year period, after he was dismissed from his job upon reaching the age of 65.

The salesman had been paid entirely on commission and his contract described him as self-employed but a UK employment tribunal found that he should have been treated as a full-time worker.

Now the ECJ Advocate General, Evgeni Tanchev, has advised that employers must provide “adequate facilities to workers” to enable them to take their paid annual leave.

Mr Tanchev said: “A worker, like Mr King, may rely on [EU law] to secure payment in lieu of untaken leave, when no facility has been made available by the employer, for exercise of the right to paid annual leave … Upon termination of the employment relationship a worker is entitled to an allowance in lieu of paid annual leave that has not been taken up.”

Lara Murray, an Associate and employment law expert with Palmers said: “This particular case is one of a number due to be heard by the ECJ in Luxembourg to establish whether gig economy employers are depriving workers of benefit entitlements by reclassifying them as self-employed.

“Full clarification is expected in the coming months by a full ECJ Court ruling although opinions given by ECJ Advocates are commonly upheld.

“If the final ruling sides with gig economy workers, UK employers using such employment practices could find that they are liable to substantial compensation claims for holiday back-pay.”

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