Workers on long-term sick leave are entitled to four weeks' paid annual leave, according to a controversial Employment Appeal Tribunal ruling earlier this year. Under the Working Time Regulations 1998, staff do not have to work to claim holiday pay and they can do so where their entitlement to sick pay has long ago expired. The ruling could make the widespread practice of keeping long-term sick employees on the payroll much more expensive. It could also apply to sabbaticals, unpaid maternity or parental leave, or even staff in prison!
Employers' organisations have demanded legislation to close this 'loophole', and the ruling may spur employers to dismiss employees with long-term medical problems. Employers should follow proper procedures before terminating staff for incapacity - unfair dismissal and disability discrimination claims could have them jumping from the frying pan into the fire.