The French Employment Court was called upon to rule on the lawfulness of the refusal to allow certain workers to take several days of accrued and unused holiday leave due to prolonged absences from work due to illness. Similarly, the relevant allowance in lieu had been denied to those workers whose employment had ended. These claims were made within 15 months of the end of the one-year reference period during which the holiday entitlement arose.
The national court made a reference for a preliminary ruling to the European Court of Justice on three questions, listed below:
– the direct applicability in relations between private individuals of Article 7 of Directive 2003/88/EC on the organisation of working time;
– what is a reasonable carry-over period for the four weeks’ leave recognised by that directive, where the accrual period for leave is one year;
– is the application of an unlimited carry-over period in the absence of national legislation governing that period in line with European law.
The decision of the European Court of Justice of 9 November 2023, Case C-271/22, resolved the first question for a preliminary ruling in positive terms, starting from a detailed analysis of Article 7 of Directive 2003/88/EC, which, although in principle cannot be directly invoked in a dispute between private parties, specifies the fundamental right to an annual period of paid leave.
This provision must be read in conjunction with Article 31, paragraph 2, of the Charter of Fundamental Rights, which provides for the right of every worker to paid annual leave.
Consequently, according to the Court, a worker may rely on the right to paid annual leave against his or her employer, and the fact that the employer is a private company is irrelevant.
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In ruling no. 13063 of 26 April 2022, the Court of Cassation set out the principle of “the manager’s power (… ) to organise their holidays independently, even if accompanied by obligations provided for by collective bargaining to inform the employer of work planning and rest periods. This does not entail the loss of the right to compensation in lieu of leave at the relationship termination if the employer, as part of their supervisory and directive duties, does not prove that they formally invited the employee to take their leave and ensured that the organisation of work and the requirements of the service to which the manager was assigned were not such as to prevent them from taking the leave.”
The Supreme Court returned to the issue of the inalienable right to leave, providing some clarifications on the employer’s obligations and allocation of the burden of proof, in continuity with the legal principle stated in ruling no. 13613/2020 and further clarifying its content, based on the rulings of the European Court of Justice.
The court followed the legal principle on holidays, according to which “the manager who, at the employment termination, has not used the accrued holidays, is entitled to compensation in lieu, unless the employer proves that the employee could exercise the right in question before termination, by providing them with adequate information and, where appropriate, by formally inviting them to do so” (see Court of Cassation ruling 2 July 2020, no. 13613).
In the past, different case law was established. This stated that “an employee with managerial status who has the power to decide independently about their holidays, without any employer interference, and has not taken them, is not entitled to any compensation because the right to leave cannot be waived. The employee’s failure to take holidays excludes the right to compensation in lieu unless they prove the existence of exceptional and objective business needs that prevented them from taking the leave” (in private employment Court of Cassation ruling 7 June 2005, no. 11786; Court of Cassation ruling 7 March 1996, no. 179; in public employment, Court of Cassation Single Section ruling 17 April 2009, no. 9146).
According to the Court of Cassation, the principle set out is based on the position taken by EU case law, which has recognised the need to “avoid a situation where the burden of ensuring the exercise of the right to paid annual leave is placed on the employee.” The worker must be invited “formally, if necessary” to take their leave and informed “accurately and in time that if they do not take it, that leave will be lost at the end of the reference period.” Lastly, at the procedural level, the Court stated that the burden of proof rests on the employer, with the result that the loss of the manager’s entitlement cannot occur if the employer is unable to prove that they have exercised due diligence to ensure that managers could take the paid annual leave to which they were entitled.
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