Compensation for holiday in the event of incapacity for work following parental leave

LAG Düsseldorf, judgment dated 26.11.2014, 12 Sa 982/14

The LAG Düsseldorf (judgment dated 26.11.2014 - 12 Sa 982/14) was recently required to concern itself with the question of whether holiday entitlement, that could not be taken immediately following parental leave as a result of sickness, also still has to be compensated in the third year thereafter.

The claimant employee was unfit for work in 2011 as a result of sickness and was released from work immediately thereafterin accordance with Sections 3 Subsection 1, Subsection 2, 6 MuSchG (Maternity Protection Act). The release continued in 2012 and 2013, in part on the basis of Section 6 MuSchG, then as a result of her parental leave, and finally due to renewed illness. The employee terminated the employment relationship at the beginning of 2014. The employer paid holiday remuneration for the years 2012 and 2013. The subject matter of the legal dispute was now the question of whether the employee was still entitled to holiday compensation for the year 2011.

The LAG affirmed that such an entitlement existed. Parental leave should not result in lapsing of the holiday entitlement. Under Section 17 Subsection 2 BEEG (Parental Allowance and Parental Leave Act), the residual holiday entitlement is automatically transferred to the time after ending of the parental leave, and can then be taken in the year in which the parental leave ends or in the year thereafter. The holiday transferred is then however subject to the same rules as applicable to the original holiday for this period. Any contract clause to the contrary is ineffective.

Extension of the holiday period in the event of illness…

Under Section 7 Subsection 3 Sentence 3 BUrlG, holiday entitlement lapses three months following the end of the holiday year if it has not been possible to grant holiday. However, under Section 7 Subsection 2 of the EU Working Time Directive, this period is extended by one year to 15 months after the end of the holiday year, if the employee has not been able to take the holiday due to illness. This was also the decision already reached by the Federal Labour Court (judgment dated 7.8.2012 - 9 AZR 353/10).

...including following parental leave

The LAG Düsseldorf has now extended this case law to holiday entitlement that has previously been transferred to the period following the parental leave in accordance with Section 17 Subsection 2 BEEG. Under Section 17 Subsection 2 BEEG, this holiday entitlement can be taken in the year in which the parental leave ends (here: 2012) or in the following year (here: 2013). This means that the holiday entitlement transferred does not lapse until 15 months after the end of the following year (i. e. in this case on 31 March 2015). The LAG considers such interpretation to be justified for reasons of equal treatment (Art. 3 Subsection 1 Basic Law), since otherwise an extended illness immediately following the parental leave would necessarily result in lapsing of the holiday entitlement. This would place an employee exercising his/her right to parental leave at a disadvantage compared to an employee who waives parental leave.

Fundamentally speaking, exactly as with additional holiday

In the case before the LAG Düsseldorf, the employee was entitled to 30 days holiday per year as per her contract of employment. This is 10 days more than the 20 days holiday to which the employee was entitled under Section 3 Subsection 1 BUrlG given a 5-day week. The EU Directive actually only protects this statutory holiday entitlement. If, however, the contract parties wish to regulate the contractual additional holiday differently to the statutory holiday, this must be clear from the contract of employment. This was not the case here. The result reached was therefore applicable to the full holiday entitlement of 30 days.

As the holiday transferred could no longer be granted in the form of release following the termination by the employee, it had to be compensated through payment of the salary for the entitlement accumulated (Section 7 Subsection 4 BUrlG).

Note

The Division granted leave for an appeal on a point of law. The proceedings are pending before the Federal Labour Court (BAG) under file ref. 9 AZR 52/15. The BAG is expected to decide on the matter on 15 December 2015.

Summary

The decision of the LAG Düsseldorf is a logical extension of the BAG case law on the extension of the holiday period, and transfers it consistently to the case of illness following parental leave. During parental leave of their employees, employers must therefore always bear in mind that these return to the company with a very full holiday entitlement, which is initially retained even given subsequent illness.