Workers are entitled to paid leave and can claim compensation if they are not allowed to take their holidays, the EU’s highest court has ruled.



In a case involving a UK window salesman, the European court of justice (ECJ) in Luxembourg – whose continuing jurisdiction is vehemently opposed by Brexiters – has reinforced employees’ rights.

The long-running legal challenge concerned a claim brought by the salesman, identified as Mr King, against The Sash Window Workshop Limited. The dispute was over his employment contract, which did not specify if he was entitled to paid leave.

The salesman had been paid entirely on commission and his contract described him as self-employed. A UK employment tribunal subsequently found he should have been treated as a full-time worker.

The case is one of a series that have gone to the Luxembourg court to establish whether businesses operating in the “gig economy” are depriving employees of benefits to which they should be entitled by reclassifying workers as self-employed.



In its judgment on Wednesday morning, the ECJ said: “A worker must be able to carry over and accumulate unexercised rights to paid annual leave when an employer does not put that worker in a position in which he is able to exercise his right to paid annual leave.

“The employer was able to benefit from the fact that Mr King did not interrupt his professional activity … It is for the employer to seek all information regarding his obligations in regard to paid annual leave.

“In the absence of any national statutory provision establishing a limit to the carryover of leave in accordance with the requirements of EU law, to accept that the worker’s acquired entitlement to paid annual leave could be extinguished would amount to validating conduct by which an employer was unjustly enriched to the detriment of the purpose of that directive, which is that there should be due regard for workers’ health.”

Claire Gilroy-Scott, a partner at Goodman Derrick, who represented King, said: “This case is of importance in clarifying that workers who are denied their entitlement under the working time regulations to paid annual leave do not have to take a period of unpaid leave first before taking legal action to receive pay for that leave.



“This would otherwise have left a worker (who was without protection from unfair dismissal and reliant upon continued work) with the unattractive prospect of having to suffer a detrimental impact on his remuneration by taking unpaid leave. The court has confirmed that a worker may carry over and make a claim for untaken leave entitlement on the termination of the engagement in these circumstances.”

James Potts, the head of legal at the law firm Peninsula, which represented The Sash Window Company, said: “Employers with self-employed individuals, whether these number in single figures or the thousands, need to seek advice on the real status of their workforce.

“This European decision binds UK tribunals when deciding similar cases. In its current form, the Brexit withdrawal bill maintains European judgments made before the UK’s exit from the EU. However, it does give the supreme court the right to depart from these decisions where it is right to do so. As such, this decision will remain binding post-exit unless a future case proceeds through the domestic courts to the supreme court, where this decision could be departed from.”

Dr Jason Moyer-Lee, the general secretary of the Independent Workers’ Union of Great Britain, said: “Today’s bombshell judgment from the court of justice of the European Union is a game changer for the so-called gig economy. The law is now recognising the massive unpaid debt of gig economy companies to their workers and IWGB members will be coming to collect.

“Today’s judgment is also a striking reminder of the impending disaster that is Brexit for worker rights. It’s cases like this one, where the Tories are told that their manoeuvres to protect big business to the detriment of workers are a step too far, that help one understand why they have such an obsessive hatred for the [ECJ]”