The right to paid annual leave: implications of accession

The right to paid annual leave:implications of accession Prof. dr. sc. Željko Potočnjak Andrea Grgić Iva Čatipović 17 April 2014 Dubrovnik

Historical Development – international level • firsttimerecognised: • 1936ILO Holidays with Pay Convention (No. 52) • 1936 Recommendation No. 47 • 1954 Recommendation No. 98 • 1970 ILO Holidays with Pay Convention(Revised; No. 132) • included in all mayor documents on human rights: • UN: • 1948 The Universal Declaration on Human Rights (Article 24) • 1966 The International Covenant on Economic, Social and Cultural Rights(Article 7 (d)) • CoE: • 1961 The European Social Charter (Article 2, point 3) and • 1996 The Revised European Social Charter Faculty of Law University of Zagreb

Development at the EU level • The Community Charter of theFundamental Rights of Workers (1989) • Directive 93/104/ECconcerning certain aspects of the organization of working time • Directive 2000/34/ECamending Council Directive 93/104/EC concerning certain aspects of the organization of working time to cover sectors and activities excluded from that Directive • Directive2003/88/EC concerning certain aspects of the organization of working time(WTD) • The Charter of Fundamental Rights of the EU (Art. 31. (2)) (2000) • caselawofthe CJEU Faculty of Law University of Zagreb

Development at EU level Faculty of Law University of Zagreb

Art. 7 WTD before the CJEU Faculty of Law University of Zagreb

Art. 7 of WTD before the CJEU Faculty of Law University of Zagreb

Researchquestions Croatian law examined under EU law: • Is the minimum period of employment a precondition for the entitlement to paid annual leave? • Can the right to paid annual leave be lost dueto overlap with another period of leave? • Are the carry – over periods in Croatian law long enough? Faculty of Law University of Zagreb

1. Minimum period of employment as a precondition for the entitlement to paid annual leave Faculty of Law University of Zagreb

EU perspective • BECTU • the entitlement to paid annual leave didn't arise until a worker had been continuously employed for 13 weeks • „the entitlement of every worker to paid annual leave must be regarded as a particularly important principle of Community social law” (para. 43) • no derogation • implementation by the competent national authorities must be confined within the limits expressly laid down by the WTD • competence of the MS? • difference between the arrangement and the entitlement for paid annual leave, • MS are not allowed to „adopt national rules under which a worker doesn't begin to accrue rights to paid annual leave until he has completed a minimum period“ of employment (para. 53) Faculty of Law University of Zagreb

Croatian perspective • The right to paid annual leave in its full duration (4 weeks) • after six months of employment (Art. 58 (1) LA) • Employees who don’t meet this condition have the right to a proportion of annual leave (Art. 59 LA) • the right to one-twelfth of (full) annual leave for each month of work • when calculating the duration of annual leave, at least half a day of annual leave is rounded up to a whole day of annual leave, and at least half a month of work is rounded up to a whole month • EXAMPLE: • The worker was employed 1.7. – 18.8., 5 days/week (Mon-Fri); 8 h/day • the worker worked more than half of August – to be rounded up to a whole month • duration of the employment relationship (for the purpose of calculating AL)? 2 months • duration of paid annual leave? 2/12 x 20 days (4 weeks; 5 working days per week) = 3, 333 days= 3 days • 0,333 days is lessthan half a day – willnot be rounded up to a whole day Faculty of Law University of Zagreb

(In)compatibility with the EU law? • status of a worker whose employment relationship with an employer lasted for less than half a month? • does relevant Croatian legislation implicate that a worker has to be in an employment relationship for at least half a month in order to begin to accrue the right to paid annual leave? • is this compatible with EU law (BECTU case)? • is a worker entitled to paid annual leave - the problem of calculation of (the duration of) annual leave? • de lege ferenda suggestions? Faculty of Law University of Zagreb

II Relationship between paid annual leave and other periods of leave- granted by EU law - not granted by EU law Faculty of Law University of Zagreb

EU perspective – maternity leave • Merino Gómez • thematernity leave coincided with the period of annual leave envisaged by the collective agreement which resulted in therefusalof annual leave • The CJEU examined the purpose of the entitlement to annual leave concluding that it „is different from that of the entitlement to maternity leave. Maternity leave is intended, first, to protect a woman’s biological condition during and after pregnancy and, second, to protect the special relationship between a woman and her child over the period which follows pregnancy and childbirth “ (para. 32) • „a worker must be able to take her annual leave during a period other than the period of her maternity leave“ (para. 37) Faculty of Law University of Zagreb

Croatian perspective • theLA contains only a very broad provision on periods which shall not „interfere“ with the duration of paid annual leave (Article 56(1)) • “holidays and non-working days established by law are not included in the duration of annual leave” and • “a period of temporary inability to work, which was confirmed by an authorised physician, is not included in the duration of annual leave” • due to traditional (paternalistic, evendicriminatory) approach, maternityleave is stillconsiderd to be „temporaryinabilityto work” • (monetary) maternalbenefitsstillmanagedbytheCroatian Health Insurance Fund • Maternity leave explicitlymentioned onlyin Art 63(3) LAwhichprovides more favourable regulation for the carrying overofnot taken or interruptedannual leave to the following calendar year, for workers who were unable to exercise it due to “illness or maternity, • parental or adoption leave” • confirmsthatmaternityleave is not to beincluded in the duration of annual leave • the same solutionproscribedregardingparentalandadoptionleave (althoughthe Art. 56. ofthe LA doesn’t provide for anyground for suchinterpretation)

EU perspective – sick leave • Schultz-Hoff and Stringer • long-term sick leave followed by dismissal • „it is common ground that the purpose of the entitlement to paid annual leave is to enable the worker to rest and to enjoy a period of relaxation and leisure, • the purpose of the entitlement to sick leave is different. It is given to the worker so that he can recover from being ill“ (para. 25) • „the right to sick leave and conditions for exercise of that right are not, as [EU] law now stands, governed by that law“ (para. 27) • nevertheless: theWTD precludes „national legislation or practices which provide that the right to paid annual leave is extinguished at the end of the leave year and/or of a carry-over period, which was the reason why the applicant could not exercise his right to paid annual leave (para. 49) Faculty of Law University of Zagreb

EU perspective (II) • a worker becoming unfit for work before the date of his allocated annual leave • C-277/08, Pereda; • C-194/12, Maestre Garzia • C-78/11, ANGELD • a worker becoming unfit for work during a period of paid annual leave • a worker has to subsequently be entitled to annual leave which has not beenused Faculty of Law University of Zagreb

Croatian perspective • a period of temporary inability to work, which was confirmed by an authorised physician, is not included in the duration of annual leave (Art 56(3) LA) Faculty of Law University of Zagreb

(In)compatibilitywith EU law? • othertypes of leave recognised by Croatianlaw • Paid: • for important personal needs (Art 65(1) LA); • when receiving education for the needs of the works council or trade union work (Art 65(4) LA) • after donating blood(Art 65(6) LA) • for the purpose of acquiring the rights arising from employment or related to employment, considered as time spent at work(Art 65(5) LA) • Unpaid: • the employer may grant a worker unpaid leave, at his or her request (Art 66 LA) • Maternity and Parental Benefits Act (Art 9(1.9)) - the right to suspension of the employment relationship until the child turns three years of age • the rights and obligations arising from employment or related to employment are suspended(unless otherwise specified by the law) (Art 66(2)LA) Faculty of Law University of Zagreb

III Carrying-over of the unusedannual leave to the next calendar year Faculty of Law University of Zagreb

EU perspective • FederatieNederlandseVakbeweging • an information brochure- a worker can obtain cash in exchange for the leave days above the mandatory minimum number of days per year,or dayswhich have been saved up over the course of previous years • „the positive effect which that leave has for the safety and health of the worker is deployed fully if it is taken in the year prescribed for that purpose, namely the current year • the significance of that rest period in that regard remains if it is taken during a later period“ (para. 30) Faculty of Law University of Zagreb

EU perspective (II) • Schultz-Hoff and Stringer • a provision of national law regardingthecarry-over period aimsto give a worker who has been prevented from taking his annual leave an additional opportunity to benefit from that leave • as such, those provisions form part of the conditions for the exercise and implementation of the right to paid annual leave - MS competence (para. 42) • „it must be held that national law can provide for the loss of the worker’s right to paid annual leave guaranteed by Art 7(1) WTD at the end of the leave year and/or of a carry-over period, but only if the worker actually had the opportunity to exercise the right conferred on him” (para. 42) Faculty of Law University of Zagreb

EU perspective (III) • KHS • Dueto incapacity, Mr. Schulte wasn't able to exercise his right to annual leave; in 2009 he brought an action for payment of allowances in lieu of annual leave not taken during the reference periods corresponding to the calendar years 2006, 2007 and 2008 • although the previous case-law indicates that a worker’s right to paid annual leave shouldn’t lapse without him actually having had the opportunity to exercise that right, „that conclusion must none the less be qualified in specific circumstances such as those in the main proceedings“ (para. 28) • it can lapse, but thecarry-over period must be „substantially longer than the reference period in respect of which it is granted” (para. 40) • Reference period = leaveyear = calendaryear • 15 months? • Neidel – 9 months? Faculty of Law University of Zagreb

Croatian perspective • Art. 63 (1) LA • two weeks of annual leave may be carried over to the next calendar year, only when an employer does not provide a worker with an opportunity to use such leave • carried over annual leave must be used no later than the 30th of June of the following year • Exceptions: • in the cases of illness, maternity, parental or adoption leave – the entire annual leave can be carried over, but it must be used by 30 June of the following year • Ship workers, posted workers and workers performing citizen duties in defence service –entitlement to use the entire annual leave in the following calendar year Faculty of Law University of Zagreb

(In)compatibilitywith EU law? • reference period in Croatia is 6 months • only by way of exception, some categories of workers are entitled to a longer carry-over period(12 months) • CJEU - the carry-over period has to be substantially longer than the granted reference period Faculty of Law University of Zagreb

First conclusions: Croatianlaw is incompatiblewith EU law • Dominguez • national law must beinterpretedinconformitywith EU law • limitedbytheprohibitionofinterpreting national lawcontralegem • direct effect of directives Is conform interpretation possible? • employer is a state body • vertical – YES • national courts should disregard any conflicting national provisions • employer is a private entity • horizontal - NO • compensation for the loss Faculty of Law University of Zagreb

Thank you for yourattention Faculty of Law University of Zagreb

The right to paid annual leave: implications of accession