In Ageli v Sabtina Ltd a contractual agreement to carry over annual leave from one year to the next allowed for a claim for holiday pay to go back to 1998.
Facts
The claimant started working for the respondent in 1987. The offer letter given to the claimant at the start of their employment stated: “You will initially be entitled to a 30 day annual leave plus bank holidays. Any additional holiday shall be at the discretion of the chairman and the managing director.” In 1996, their holiday entitlement was increased to 45 days.
In the first three years of employment, the claimant did not take any annual leave because their holiday requests were refused as there was no one else to manage in their absence. Memos detailing the managing director’s refusal of the claimant’s holiday requests were presented as evidence, covering dates from 1988–2002. In most of the years covered in the memos, over half of the claimant’s annual leave entitlement was refused.
It was agreed that any unused holiday entitlement would roll forward from one year to the next and the claimant would be paid for these either as and when they requested or at the end of the employment. The claimant requested such a payment twice — once in 2001 and again in 2002. This was paid by agreement with the managing director, but this did not cover all the outstanding pay.
Without explanation, the claimant was sent an email informing them that they were dismissed for gross misconduct with immediate effect. The claimant had not been warned about this, nor had any disciplinary procedures been followed. The claimant was not afforded the right of appeal.
The claimant made various claims, including failure to pay holiday entitlement. They asked for their outstanding holiday pay to be paid, alleging that there were 698 days of untaken holiday between 2003-2024.
Employment Tribunal (ET)
Based on evidence of the agreements between the claimant and the respondent, it was found that there was a contractual agreement in place for the claimant’s unused holiday entitlement to roll forward from one year to the next. This was based on the following.
- Documentation from the time showed that the claimant was regularly refused requests for holiday and the claimant’s unused holiday was approved by the managing director and kept on record. This, the ET found, would only be the case if there was an agreement that it would roll over.
- Evidence confirmed that the claimant was allowed to take large payments in lieu of holiday entitlement in 2001 and 2004. This, it was found, indicated that the claimant did not believe that the holiday entitlement would be lost at the end of the year, otherwise they would have done this every year and it would have been approved, as the managing director had done previously.
- When the claimant wrote to the respondent complaining of their treatment, they claimed “…a full settlement of all that is due to me in terms of all my backlog holiday pay…” This meant, the ET said, that the claimant understood that the holiday pay had been rolled forward each year.
In relation to the Working Time Regulations claim, it was found that prior to those regulations coming into force in 1998, there was no statutory right to holidays. The claimant was not told by the respondent in the years after 1998 that any leave not taken by the end of the leave year which could not be carried forward would be lost. As a result, it was found that the claimant’s basic holiday entitlement had rolled over every year until 2024.
As the respondent had failed to pay the claimant’s holiday entitlement, it was ordered to pay the claimant the gross sum of £391,942.77 (subject to tax and National Insurance).
