This week, Esther Smith, partner at Thomas Eggar, and Martin Brewer, partner and employment law specialist at Mills & Reeve, advise on what to do when an employee has used up all their annual leave entitlement, so has the holiday request refused, and then makes it known they plan to take the week off sick instead.

The question:

One of our employees has already used up all of his 22 days annual leave entitlement. However, he now wants to book an extra week off in August, citing that as he has worked for us for five years, he should be allowed an extra week's leave (he already gets two days extra for his length of service thus far).

Unfortunately, as this is a key holiday time, with two of our other employees already booked off the same week, and as he has already used up his alloted allowance, we've had to refuse his request for the time off due to staffing levels (we are only a small firm, so three workers being absent simultaneously would be a real stretch).

We have since found out from his co-workers that as we refused his holiday request, he is now planning to go off sick for that week in August instead (and use a self certification notice from his doctors). When asked, he freely admitted that he was going to go off sick and we'll have to pay him statutory sick pay (SSP) whilst he's off.

Can he do this? If you know an employee is going to take a week off sick in advance, when he isn't actually sick, is it a potential disciplinary matter? Does SSP still have to be paid when you know that the employee isn't really going to be sick that week?

This guy has a really good attendance record otherwise, and I'm unsure as to how best to proceed from here. Any advice would be welcome.

Caroline Ashton

Legal advice:

Esther Smith, partner, Thomas Eggar

You are absolutely fine to refuse this employee's holiday request given that he has already used all of his entitlement. Even if he had not, you should provide in your contract that all holiday needs to be agreed in advance with the employer, giving you the ability to refuse a holiday request that conflicts with other employees or peak times for the business.

Whilst he may feel that he should get additional holiday as he has worked for over five years, the law does not reflect this, so long as you are complying with the statutory requirements under the Working Time Regulations 1998 then you are fine. The current entitlement (until October 2007) is to four weeks (20 days for an employee working five days per week) which can include the statutory bank holidays, so from the information provided you are fine on this point.

It is quite common for employees to then take time off sick if they have been refused holiday. However this is quite foolish as an employer does have the right to challenge this through disciplinary action. Whilst the employer is not going to be able to prove that the employee was not sick, they only need to show that they had a reasonable belief that the employee was not being honest with them in order to uphold a disciplinary sanction. Given that this employee has told you and other colleagues openly that he is going to take this time off, you are in a very strong position to discipline here.

With regard to statutory sick pay you have an obligation to pay this after the initial qualifying days of absence, if a doctor's certificate has been provided. In effect, this means that he would only get paid for the last day, as there are four qualifying days on which no payment has been made.

If he is a good employee generally it may be worth making him aware that if he does take the time off that week when he has been refused holiday, in light of the fact that he has openly told people that he intends to take the time off as sickness, it is highly likely that he will face disciplinary action as such action on his part could amount to a breach of contract and misconduct. Hopefully he may reconsider his position if he knows that the company will take this stance.

Esther Smith is a partner in Thomas Eggar's Employment Law Unit. For further information please visit Thomas Eggar

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Martin Brewer, partner and employment law specialist, Mills and Reeve

If this employee is really going off sick when not ill then there area number of consequences.

First, he is in fact going to be on unauthorised leave since his self-certification will not relate to a real illness. Therefore he will not be entitled to SSP or any company sick pay.

Second, the unauthorised absence will be a breach of contract of itself.

Third, this employee's behaviour seems to me to amount to a breach of trust and confidence in that he is not going to be bound by his obligation to make himself available for work in circumstances where he is neither on leave not genuinely sick, he will lie to you through the provision of a false sick note and he is imposing an unnecessary extra burden on your other staff.

Clearly this is a disciplinary matter but you must follow a proper process before reaching a conclusion. At present you only have threatened misconduct so do bear that in mind.

Martin can be contacted at: martin.brewer@mills-reeve.com

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