Q&As

At what rate does an employee on long-term sickness absence, receiving permanent health insurance payments, have to be paid if they take holiday?

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Published on LexisPSL on 07/12/2016

The following Employment Q&A provides comprehensive and up to date legal information covering:

  • At what rate does an employee on long-term sickness absence, receiving permanent health insurance payments, have to be paid if they take holiday?

A worker is entitled to be paid in respect of any period of annual leave (and additional annual leave) at the rate of a week's pay in respect of each week of leave (regulation 16(1) of the Working Time Regulations 1998 (WTR 1998), SI 1998/1833 (WTR 1998, SI 1998/1833, reg 16(1)). The method of calculating a week’s pay will depend on whether the employee works normal working hours (sections 221–223 of the Employment Rights Act 1996 (ERA 1996)) or not (ERA 1996, s 224).

For further information, see Practice Note: Holiday pay—Calculating statutory holiday pay: general.

The European Court of Justice (ECJ) in Robinson-Steele v RD Retail Services has emphasised that the purpose of the requirement for paid annual leave is to put the worker, during annual leave, in a position which is, as regards remuneration, 'comparable to periods of work'. Therefore, 'workers must receive their normal remuneration for that period of rest', and not any reduced rate, such as may be the case with sick pay. See Robinson-Steele v RD R

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