15 Jun Accrual of Annual Leave During Sick Leave

A recent award under the Organisation of Working Time Act should be noted when the Adjudication Officer not only made and an award of €5,483.40 for annual leave accrued during long term sick leave, but a further €5,000 compensation for an employer’s refusal to pay the leave when requested by an employee on termination of her employment. (Ref ADJ – 00025283)

The Complainant submitted a complaint under the Organisation of Working Time Act, 1997 that she had not been paid for outstanding annual leave accrued during a period of extended sick leave from May 2017 until February 2019. The Complainant resigned and requested payment of the leave but was told she was not entitled to it. The Complainant produced evidence at the hearing that she had submitted medical certificates as required during the period of sick leave.

The Respondent did not attend the hearing and did not submit a written submission.

The Adjudication Officer confirmed as per Sections 20 (1) (c) (iii) of the Organisation Of Working Time Act, 1997, that the Complainant had accrued leave for the period of sick leave and was in accordance with Section 23 (b) (iii) entitled to be paid for the accumulated annual leave that she was unable to take. This amounted to a total of 37 days leave @ €148.20 per day, a total of 5,483.40. The Adjudication Officer awarded a further €5,000 in compensation due to the Respondent’s refusal to pay the accrued leave when requested to do so.

The entitlement to accrue annual leave during periods of certified sick leave was introduced in Section 86 of the Workplace Relations Act 2015, which inserted a new section into the Organisation of Working Time Act 1997. However, annual leave does not accrue indefinitely during periods of sick leave, and a 15 month carry-over period was also introduced, to allow an employee, who due to illness, is unable to take all or any part of his or her annual leave during that leave year or the 6 months thereafter, and has provided a certificate of a registered medical practitioner in respect of that illness to his or her employer, to take the leave within a period of 15 months after the end of that leave year. Once the 15 month period has elapsed the leave is lost if not used.

The amended Section 23(1) of the Organisation of Working Time Act 1997 also provides for payment in respect of accrued and unused annual leave for an employee who has been absent on long-term sick leave immediately before the termination of his or her employment, again with reference to the 15 month period after the end of the leave year.

It should be noted however that the “leave year” is defined by Section 2 of the Organisation of Working Time Act 1997 as running from 1 April to 31 March, and it is this year that should be used for calculation purposes and not any different leave year in operation, which is often the “calendar year” for most employers.

Employers should therefore be aware of the potential for a significant amount of leave to accrue during periods of sick leave, and which can extend across three different leave years subject to when an employees returns to work or their employment is terminated. Good absence management procedures and processes can minimise the accrual of extended leave over multiple years. If you need any assistance with dealing with absence management issues, please contact Carmel Murphy on (071) 9642748 or email info@hrsolutions.ie.