Lyons v Mitie Security Ltd

Minimum paid annual leave is subject to properly operated statutory or contractual notice requirements. Those requirements may regulate when leave is taken and may be varied by a legally enforceable written agreement. They must operate throughout the leave year and must not be used unreasonably, arbitrarily or capriciously to defeat a lawful request for leave. However, the right to take statutory leave is not inalienable. Where the worker has had a genuine opportunity to take leave and the notice mechanism has been properly operated, untaken leave may be lost at the end of the leave year.

The claimant, a security officer, appealed against a London (South) Employment Tribunal’s dismissal of complaints of constructive unfair dismissal and payment for untaken holiday under the Working Time Regulations 1998. The Tribunal treated the employer’s refusal to pay for nine untaken days as a contractual disagreement and did not adequately analyse the cumulative effect of earlier holiday-pay disputes, site bans and cancelled shifts.

The appeal raised whether the claimant had been refused leave or merely payment, whether contractual notice provisions had been properly applied, and whether statutory or contractual notice requirements could prevent a worker taking statutory leave before the end of the leave year.

1. The appeal succeeded. The Tribunal had failed to analyse adequately the cumulative effect of the alleged contractual breaches and had failed to determine properly whether the refusal concerning the nine days’ holiday pay was itself a breach. The case was remitted to a different Tribunal for rehearing.
2. In a constructive dismissal case, the Tribunal must consider the employer’s conduct as a whole. It must identify the relevant incidents and assess their cumulative effect, including whether a final act constituted a last straw.
3. Regulation 13 of the Working Time Regulations 1998 establishes the statutory entitlement to paid annual leave. Regulation 15 provides the mechanism by which leave is requested and refused. Regulation 15(5) permits those notice provisions to be varied by a relevant agreement, including an enforceable written contractual provision. Regulation 17 does not invalidate a contractual variation merely because it imposes a longer notice period; it concerns competing leave entitlements.
4. The statutory entitlement is not inalienable. Article 7 of Directive 2003/88/EC envisages conditions for entitlement to and granting of leave laid down by national law or practice. Accordingly, a properly operated statutory or contractual notice mechanism may result in the loss of untaken leave at the end of the leave year, consistently with Stringer.
5. The mechanism must nevertheless operate throughout the leave year and must not be used in an unreasonable, arbitrary or capricious manner so as to deny leave lawfully requested. The employer’s response must be assessed against the contractual provisions, including the reasons for shorter notice, the merits of the application and staffing requirements.

• Employment Appeal Tribunal: allowed the appeal against the London (South) Employment Tribunal’s judgment and remitted the matter to a different Tribunal for rehearing.
• London (South) Employment Tribunal: dismissed complaints of constructive unfair dismissal and payment for untaken holiday in reasons delivered on 13 November 2008.