This time last year we reported that the European Court had opened the door to significant holiday pay claims when they issued their judgement in the case of King v Sash Window Workshop Ltd and another. The case concerned Mr King who had been engaged on a self employed basis for 13 years by the Sash Window Workshop. On termination of his employment he claimed for holiday pay on the basis that he had in fact been a worker throughout the period of his time with the company. The case proceeded through Tribunal, EAT and the Court of Appeal who referred a number of questions to the ECJ including (1) in what circumstances untaken paid leave can be carried over to a new holiday year and (2) whether paid leave could be carried over indefinitely.
The ECJ's judgement was that where a worker has not taken holidays because he is not paid for them (in circumstances where he should be paid for them) the Working Time Directive requires the right to paid leave to accumulate until the termination of employment. It did not matter that, in this case, the employer did not think that Mr King was a worker (they believed him to be self employed).
The matter was due to return to the Court of Appeal on 20 November 2018 for them to decide whether Mr King was entitled to be paid for periods of accrued leave on termination of employment in his particular circumstances (where the employer had deterred him from taking the leave by not granting it).
Although we do not know the terms of the settlement that has reportedly been reached, the settlement does not change the fact that the ECJ judgment means that organisations at risk of having wrongly categorised workers as self employed run the risk of claims for unpaid annual leave going back many years. As we mentioned previously, while the impact of this judgement is not sector specific it will be of particular concern to those in the gig economy with employment status claims pending.