Workers who fall ill during their holidays will be entitled to take paid leave at a later date, the European Court of Justice has ruled.
Business representatives have warned that in the current climate, small firms can “ill afford” the potential extra payments but the EU-wide ruling is binding on the UK and other member states.
The ruling, which emerged from a trade union case against a department store group in Spain, can be applied regardless of when an employee becomes sick.
The ECJ ruling said: “The point at which the temporary incapacity arose is irrelevant...consequently, a worker is entitled to take paid annual leave, which coincides with a period of sick leave, at a later point in time, irrespective of the point at which the incapacity for work arose.”
It also emerged today that the European Commission is taking Britain to court in a battle over an unpaid bill of millions of pounds in duty on imports of garlic.
The legal action was announced as an ultimatum to pay £15m to Brussels or face action in the European Court of Justice expired.
The wrangle is over the fact that import tariffs on frozen garlic from outside the EU are lower than the rates for fresh garlic.
And, according to the Commission, UK authorities carelessly levied the lower rate applicable to frozen garlic on imports of the fresh product from China, in breach of EU customs rules.
All customs duties charged on imports of goods coming from a non-EU country are collected by member states on behalf of the EU and paid to the common EU budget as part of each member state's annual contributions.