Employment Law

Andrew Egan, an employment lawyer with solicitors, Charles Lucas & Marshall, reports on a decision which could allow workers to apply for additional leave if they become sick on holiday.

The European Court of Justice (ECJ) decided on 10th September that where an employee falls ill while absent from work on holiday, the employer should provide additional holiday at a later time to the employee to compensate.

This case now raises doubts as to whether a worker who is on long term sick leave can be forced by the employer to take his statutory annual leave at the same time (thus saving the employer money on sick pay in some cases).

This decision should stop the questionable practice by which some employers sometimes deliberately require employees to take their holiday while they are off sick.

Sr Vicente Pereda had booked holiday leave for the end of July 2007. However he had an accident at work in early July. This meant he was away on sick leave and could not take most of the holiday.

His employer, without giving reasons, turned down his request for substitute holiday leave. He challenged this in a court in Madrid and the Court stayed proceedings, pending an answer from the European Court.

The ECJ said that:

“…… a worker who is on sick leave during a period of previously scheduled annual leave has the right, on his request and in order that he may actually use his annual leave, to take that leave during a period which does not coincide with the period of sick leave”It seems the Court’s conclusion is that not only are workers entitled to postpone holiday because of sickness but also that, if they fall sufficiently ill while absent on holiday to qualify for “sick leave,” then they will be entitled to insist on being allowed additional holiday to compensate after their recovery.

In practice it is impossible for an employer to properly monitor whether an employee on holiday was genuinely suffering from a condition serious enough to entitle them to sick leave. How will they know whether a worker is genuinely sick during periods of annual leave when employees are entitled to self-certify for the first seven days of sickness absence? It would open the door to abuse from false claims and from genuine claims, possibly from self-imposed accidents and sickness. It would certainly also lead to yet more unfair dismissal litigation.

Employers should remember, however, that they are entitled to monitor absence and any ‘patterns’ in absence, so that if a worker frequently claimed he was sick whilst on holiday, this should be investigated and where appropriate, disciplinary action may be taken.

Employers should also remember to apply the relevant sickness absence rules to any absence in these circumstances, particularly regarding notification of absence and reasons for absence. If the employee receives only statutory sick pay (‘SSP’) during sick leave, payment for any sick days should be made only at this rate, remembering of course that the first three days of sick leave are ‘waiting days’ where no SSP is payable.

For further advice or information on this subject, contact Andrew Egan on 01793 511055 or on
FREEFONE 0800 180 4835 or andrew.egan@clmlaw.co.uk

There has been increasing use of compromise agreements by employers as a result of the current economic climate and the subsequent redundancies and dismissals from employment of many workers.

A compromise agreement is a legally binding agreement under which an employee agrees not to make a claim in an employment tribunal or the courts against their employer in exchange for receiving a compensation payment. The payment is usually tax free and more money than the employee would otherwise be legally entitled to receive.

These agreements can be a means of terminating employment without really giving employees ‘a fair deal’ and an excuse to ‘get rid of’ employees for reasons other than redundancy or genuine economic reasons.

What sometimes appears to be an attractive termination package offered to an employee may not in reality, be fair for the employee. Three months pay might sound like a good offer but if an employee’s contractual notice period is three months, he or she may really only be getting that money tax free and without contract benefits for the three month notice period.

From a practical point of view, employees need to bear in mind that such a payment will not go far if they do not have another job to go to and that looking for another job often takes longer than expected.

It is therefore essential that employees seek advice about what they are agreeing to. It is, in any event, a legal requirement that before signing such an agreement, an employee take independent legal advice as to the meaning of the terms of the agreement and its affect on their employment rights. It is also customary and usual practice for employers to contribute towards the legal expenses incurred for the legal advice in connection with the agreement.

Compromise agreements are an effective tool in ensuring both employer and employee can resolve an issue fairly. The agreements are usually prepared by the employer’s solicitors and on terms offered by the employer. They should therefore not be taken as read or as necessarily the best deal on the table. If an employee does not take proper legal advice, he or she could be walking away with a settlement which is far from fair and which has not reviewed the alternatives.

Solicitors are best placed to advise employees on these matters and can negotiate on the employee’s behalf. We can advise on the taxation implications arising from a settlement payment and how that payment could be structured in the most tax efficient way. We can ensure that other matters, such as length of service, other contractual benefits, outplacement assistance and references, are all taken into account in the settlement, as well as advice on the effect of confidentiality obligations and post termination restrictive covenants.

For more information please contact Andrew Egan on 01793 511055 or on
FREEFONE 0800 180 4835 or andrew.egan@clmlaw.co.uk

If so, the first thing you should do is see a solicitor with employment expertise.

The law requires that you take independent legal advice before signing such a binding agreement with your employer. The agreement means that you are effectively being “bought off” – your employer is paying you a sum of money, usually tax free in exchange for you giving up your legal rights to claim against your employer in a Tribunal or Court.

This is perfectly legal and quite common and a sensible way of avoiding the costs and time associated with litigation, but you need to know what the agreement terms mean, how they affect you, what other options you may have, and is it the best deal or package for you.

Your solicitor can help you with these things and sometimes negotiate a better deal for you, as well as advise you regarding any tax implications and the effect of any restraints of trade, references etc.

For more information please contact Andrew Egan on 01793 511055 or on
FREEFONE 0800 180 4835 or andrew.egan@clmlaw.co.uk