The Claimant, Mr Healy, worked for the Respondent before suffering a stroke. He was subsequently off on sick leave from June 2010 until July 2011, when he resigned. He sought payment in lieu of holidays he argued had accrued whilst on sick leave under Regulations 13 and 13A of the Working Time Regulations, which implement the Working Time Directive.

The Respondent argued that the Directive only applied to emanations of the state and, if not, that payment in lieu of leave for that part of the first leave year Mr Healy had been sick had not been requested and could not be carried forward. The appeal was postponed until the decision of the Court of Appeal in NHS Leeds v Larner was available.

The EAT found that allow the Directive did not have direct effect against individuals, domestic law had to be interpreted to be compliant with it. As such, the Regulations should apply not only to emanations of the state, but also to private companies. Furthermore holiday leave which could not be taken because of illness could be carried forward, and there was no need for a request for payment in lieu to have been made.

However the EAT did find that it is the only shorter period of 20 days under Article 13 that carries over (in the absence of any agreement) and for which employers will have a liability to pay where the contract is terminated, rather than the additional UK statutory entitlement of 8 days added to the Regulations by the amending Regulations in 2007 and contained in Article 13A. In this case, this meant that Mr Healy was then only entitled to payment in lieu of his balance of 20 days leave for the first year. He was then entitled for payment in lieu of the balance of 28 days for the second leave year under Article 13A. http://bit.ly/12Lyaqz