The Workplace Relations Act 2015, signed into law on the 21st May 2015, commencing on the 1st October 2015, makes wide-sweeping changes to Employment Law and to employment rights and industrial relations bodies, merging them into the “Workplace Relations Commission” and the “Labour Court”.

The change in the legislation brought about by Section 86 of the Act, which amends the Organisation of Working Time Act 1997, the Act which sets out the statutory annual leave entitlement for employees, will have a considerable impact with regard to annual leave and employees who are on certified sick leave.

The new Act allows workers who are on certified long-term sick leave to accrue and retain their annual leave for up to fifteen months from the end of the year in which it accrued.  This brings the 1997 Act into line with rulings of the EU Court and an EU Directive.

At present an employee’s annual leave is based on the numbers of hours worked in any year.  Therefore, in the private sector, annual leave did not accrue while an employee was on sick leave, contrary to the EU directive on working time.

Irish public sector workers already benefit from decisions of the European Courts interpretation of the directive that annual leave accrues to an employee while absent due to certified illness.  This did not apply, however, to workers in the private sector and it is this inconsistency that the new 2015 Act seeks to correct.

The current law provides for a maximum “carry over” period of statutory annual leave for six months following the annual leave year.  This failed to take into account the fact that an employee on long-term sick leave may not be in a position to take his annual leave within the six month period due to illness.

Under the new Act, a day that an employee was absent from work due to illness is, if the employee provided to his employer a certificate of a registered medical practitioner in respect of that illness, deemed to be a day on which the employee was at his place of work or at his employer’s disposal and carrying on or performing the services or duties of his work.

The Act also provides that where an employee is unable, due to certified illness, to take his annual leave during the leave year or the six month period thereafter, such an employee may now do so within a period of fifteen months after the leave year in question.

The fifteen month extended period was an effort by the Government to strike a balance between the working time directive of the EU and the potential cost to employers of this amendment.  In introducing the legislation last year, Minister Ged Nash stated that in this legislation he had “struck the right balance between protecting the rights of vulnerable workers who are off work due to serious illness and trying to minimise the cost to business”.

Private sector employees will now have the same rights as others as to annual leave entitlements while on sick leave.  Employers and employees are, of course, free to agree more generous employment terms with regard to annual leave and sick leave entitlements.

Employers, therefore now, need to look to their employees’ contracts of employment to ensure that they are in compliance with the changes regarding annual leave and sick leave entitlements.