On 29 November 2017 the European Court of Justice (“the ECJ”) has given Judgment in Case C-214/16, King v The Sash Window Workshop Ltd, in which Mr King sought an allowance in lieu of annual leave not taken, or taken but not paid, for the years 1999 to 2012, the entire period of his engagement by the Defendant. The Defendant rejected the claim on the basis that Mr King was self-employed. By the time the case reached the ECJ it was common ground that Mr King was nonetheless a “worker” for the purposes of the Working Time Directive.
The ECJ has now held that Article 7 of the Directive (1) precludes the worker having to take his leave first before establishing whether he has a right to be paid in respect of that leave and (2) precludes national provisions or practices that prevent a worker carrying over and, where appropriate, accumulating, until termination of his employment relationship, paid annual leave rights not exercised in respect of several consecutive reference periods because his employer refused to remunerate that leave.
As the Employment Lawyers Association has stated:
“This case has significant implications for the right to holiday pay in the UK. It suggests that workers who are wrongly classified as self-employed contractors may be able to claim back pay in respect of unpaid annual leave going back many years when their ‘worker’ status is established. It also suggests that the Deduction from Wages (Limitation) Regulations 2014 SI 2014/3322, which limit back pay claims to two years, are incompatible with EU law.”