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Case Law

What Happens to Accrued Annual Leave When an Employee Dies?

Is an employee’s accrued and untaken annual leave extinguished by his death? This was the question the Court of Justice of the European Union (‘the CJEU’) had to decide in a recent case.

Bollacke v Klass & Kock B.V. | CJEU

Background

The Working Time Directive (‘the WTD’) provides that all workers are entitled to at least four weeks’ paid annual leave. No derogation is allowed from this right although an employer is permitted to make a payment in lieu of unused annual leave at the end of the employment relationship.

Mr B had been employed in Germany by K & K from 1998 until his death in 2010. Mr B had been off work sick for most of 2009 and 2010 and at the date of his death he had accrued 140.5 days of untaken annual leave.

Mr B’s wife made a request to K & K for payment in lieu of the annual leave her late husband had accrued. K and K refused to pay because, under German labour law, the right to be paid for outstanding annual leave does not arise where the employment ends because the employee has died.

Mrs B brought a claim for the outstanding pay. The German court made a reference to the CJEU to decide whether German law was inconsistent with European law.

The Decision

The CJEU held that the employee’s right to be paid in lieu of untaken annual leave outstanding at the end the employment relationship cannot be removed by national legislation. German law was inconsistent with the right to be paid annual leave contained in the WTD and Mrs B was entitled to payment in lieu of her late husband’s outstanding 140.5 days annual leave.

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