Employees who are sick during scheduled annual leave should be allowed to reallocate their holidays, the European Court of Justice (ECJ) has ruled.

The decision, a new interpretation of the working time directive, follows the ECJ’s ruling on the Stringer case earlier this year that holiday continues to accrue during sick leave. Stringer found that a worker could carry leave forward, even into the next year, if he or she is “unable to take leave through no fault of his own”, but left open the question of what would happen if sickness coincided with scheduled leave. The court has now ruled that employees should have the right to ask for statutory leave to be reallocated in these circumstances, even into the next holiday year.

In the case of Pereda v Madrid Movilidad, the employee was injured shortly before the annual leave was due to start and was refused a request to move his holiday. But there is no reason in principle why an employee whose holiday had already started could not claim the right to reallocate leave, lawyers have warned.

“Many employers take the view that if an employee is sick while on holiday, that is just bad luck for them,” said Owen Warnock, partner at law firm Eversheds. “The European court has now said that this is not allowed by the working time directive. The danger of abuse is clear: an employee could increase his or her holiday entitlement by ensuring that in most years they alleged they were sick while on holiday. It may only be the occasional ‘bad penny’ who does this, but the resentment that it would create with colleagues should not be underestimated.”

Workers who are on sick leave have a choice, said Warnock. They can take annual leave if they wish, but if they would prefer not to do so they can insist on postponing their annual leave and taking it at a later date, possibly even in a subsequent leave year if it is not possible to schedule leave before the current year ends.

But he added: “Until the European or UK courts say otherwise, our view is that employers are entitled to require workers to produce convincing evidence of their illness while on holiday and that it would have rendered them unfit for work before allowing workers to ‘reallocate’ holidays.”

The CIPD attacked the judgment as unrealistic, while the CBI said “it opened the door for abuse”. But HR professionals contacted by PM suggested that giving back holiday is already considered in many circumstances.

“In practice, we do give back holiday entitlement,” said Yvonne Anderson, HR manager at Campbell Dallas LLP. “This happens rarely and is used by those who have missed out on an important holiday or who have been so unwell that they haven’t been able to do much. A lot of the strength of feeling on this matter would be about how genuine you felt the sickness was.”

For those employees on long-term sick leave who have made a return to the workplace, giving back holiday entitlement “seems like the right thing to do”, she added.

Rachel Cairns, HR manager of the facilities directorate at Keele University, said she thought many line managers would be “aghast at the prospect” of the judgment, but that she took a measured view of it.

“In principle, I am in favour of employees who are genuinely ill being able to reallocate annual leave. Of course, the danger is that, inevitably, a minority of people will abuse the right by fraudulently claiming sickness while on holiday. It is essential then that organisations have robust absence management policies and procedures and take prompt action to deal with any ‘abusers’,” she said.