The Court of Justice of the European Union (CJEU) has declared that the heirs of a deceased employee are entitled to an allowance for unclaimed annual leave. In a separate case, the Court found a worker cannot automatically lose his right to paid leave because he did not apply for it.
The first case involved two widows who sought an allowance in lieu of annual leave that was not taken by their husbands prior to their death. This was refused by the two employers in this case.
The German Federal Labour Court therefore asked the CJEU to interpret EU legislation under which employees are entitled to at least four weeks paid annual leave per annum. In the event of the employment relationship being terminated, an allowance may be paid in lieu. The CJEU had already ruled that a workers right to paid annual leave does not lapse upon his death, however it was unclear whether this was also the case where German law precluded the allowance in lieu forming part of the estate.
The Court acknowledged the purpose of the leave was to grant a period of rest which a deceased worker could no longer enjoy, however it could not separate this from the entitlement to payment. This payment is an asset of the worker and therefore must form part of his estate – to hold otherwise would undermine the very substance of the right. The Court continued that should national law contradict this, the heirs may rely on EU law against the employer.
In another recent decision, the CJEU was asked to determine whether the right to an allowance in lieu of paid annual leave may be precluded where the worker failed to apply for the leave he was entitled to, despite being in a position to do so. The Court also look more generally at whether that right is based on the premise that the worker had not been able to exercise his right to paid annual leave before employment terminated for reasons beyond his control.
The Court found that a worker does not automatically lose these rights, and they may lapse only if the employer “gave the worker the opportunity, in particular through the provision of adequate information, to take the leave days at issue in good time, which the employer must prove he has done.” The Court was cognisant of the balance of power in an employment relationship, however, found that if it was shown that a worker deliberately and knowingly declined to take paid leave having been given the opportunity to, EU law does not preclude the loss of leave not taken or an allowance in lieu.
Click here for the judgement in Stadt Wuppertal v Maria Elisabeth Bauer.
Click here for the judgement in Kreuziger v Land-Berlin and Max-Planck-Gesellschaft.