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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> British Airways Plc v Williams & Ors [2009] EWCA Civ 281 (03 April 2009) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2009/281.html Cite as: [2009] ICR 906, [2009] IRLR 491, [2009] EWCA Civ 281 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
(Mr Justice Keith presiding)
UKEAT/0377/07/MAA
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE LLOYD
and
LORD JUSTICE RIMER
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BRITISH AIRWAYS PLC |
Appellant |
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- and - |
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MS S. WILLIAMS AND OTHERS |
Respondents |
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Miss Jane McNeill QC, Mr Keith Bryant and Mr Michael Ford (instructed by Thompsons) for the Respondents
Hearing dates: 26, 27 November 2008, 19 March 2009
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Crown Copyright ©
Lord Justice Rimer :
Introduction
"Whether, as a matter of domestic and Community law, paid leave for the purposes of Regulation 4 of the Civil Aviation (Working Time) Regulations 2004 is to be calculated in accordance with Regulation 16 of the Working Time Regulations 1998 and, if not, how it is to be calculated."
The Working Time Directive and Working Time Regulations
"1. Every person taking the holiday envisaged in this Convention shall receive in respect of the full period of that holiday at least his normal or average remuneration (including the cash equivalent of any part of that remuneration which is paid in kind and which is not a permanent benefit continuing whether or not the person concerned is on holiday), calculated in a manner to be determined by the competent authority or through the appropriate machinery in each country." (Emphasis supplied)
"Annual leave
1. Member States shall take the measures necessary to ensure that every worker is entitled to paid annual leave of at least four weeks in accordance with the conditions for entitlement to, and granting of, such leave laid down by national legislation and/or practice.
2. The minimum period of paid annual leave may not be replaced by an allowance in lieu, except where the employment relationship is terminated."
The Civil Aviation sector: the Aviation Agreement and Directive
"1. Mobile staff in civil aviation are entitled to paid annual leave of at least four weeks, in accordance with the conditions for entitlement to, and granting of, such leave laid down by national legislation and/or practice.
2. The minimum period of paid annual leave may not be replaced by an allowance in lieu, except where the employment relationship is terminated."
That replicated the language of article 7 of the Working Time Directive; and Miss McNeill said that the meaning of "paid annual leave" is, like the same phrase in article 7, informed by article 7.1 of the ILO Convention.
"(11) In view of the highly integrated nature of the civil aviation sector and the conditions of competition prevailing in it, the objectives of this Directive to protect workers' health and safety cannot be sufficiently achieved by the Member States and Community action is therefore required in accordance with the subsidiarity principle laid down in Article 5 of the Treaty. This Directive does not go beyond what is necessary to achieve those objectives.
(12) With regard to terms used in the Agreement which are not specifically defined therein, this Directive leaves Member states free to define those terms in accordance with national law and practice, as is the case for other social policy Directives using similar terms, providing that the said definitions are compatible with the Agreement."
Article 1 of the Aviation Directive provided that its purpose was to implement the Aviation Agreement. Article 2.1 permitted Member States to introduce more favourable provisions than those laid down in the Directive. Article 3 provided that:
"Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive not later than 1 December 2003 or shall ensure that, by that date at the latest, management and labour have introduced the necessary measures by agreement. The Member States shall take any necessary measure to enable them at any time to be in a position to guarantee the results imposed by this Directive. They shall forthwith inform the Commission thereof. "
The amendment to the Working Time Regulations
"30.(1) A worker may present a complaint to an employment tribunal that his employer
(a) has refused to permit him to exercise any right he has under
(i) regulation 13 [which entitles the employee to four weeks' annual leave] .
(b) has failed to pay the whole or any part of any amount due to him under regulation 16(1) [which entitles him to a week's pay for each week of leave calculated in accordance with sections 221 to 224 of the ERA]
(2) An employment tribunal shall not consider a complaint under this regulation unless it is presented
(a) before the end of the period of three months beginning with the date on which it is alleged that the exercise of the right should have been permitted (or in the case of a rest period or leave extending over more than one day, the date on which it should have been permitted to begin) or, as the case may be, the payment should have been made;
(b) within such further period as the tribunal considers reasonable in a case where it is satisfied that it was not reasonably practicable for the complaint to be presented before the end of that period of three months.
(3) Where an employment tribunal finds a complaint under paragraph (1)(a) well-founded, the tribunal
(a) shall make a declaration to that effect, and
(b) may make an award of compensation to be paid by the employer to the worker.
(4) The amount of the compensation shall be such as the tribunal considers just and equitable in all the circumstances having regard to
(a) the employer's default in refusing to permit the worker to exercise his right, and
(b) any loss sustained by the worker which is attributable to the matters complained of.
(5) Where on a complaint under paragraph (1)(b) an employment tribunal finds that an employer has failed to pay a worker in accordance with regulation 16(1), it shall order the employer to pay to the worker the amount which it finds to be due to him."
Inland waterway shipping and sea fishermen
The Civil Aviation (Working Time) Regulations 2004
"4.(1) A crew member is entitled to paid annual leave of at least four weeks, or a proportion of four weeks in respect of a period of employment of less than one year.
(2) Leave to which a crew member is entitled under this regulation
(a) may be taken in instalments;
(b) may not be replaced by a payment in lieu, except where the crew member's employment has terminated."
"18.-- (1) A crew member may present a complaint to an employment tribunal that his employer has refused to permit him to exercise any right he has under regulation 4 .
(2) An employment tribunal shall not consider a complaint under this regulation unless it is presented
(a) before the end of the period of three months beginning with the date on which it is alleged
(i) that the exercise of the right should have been permitted (or in the case of a rest period or annual leave extending over more than one day, the date on which it should have been permitted to begin), or
(ii) the payment under regulation 4(2)(b) should have been made;
as the case may be; or
(b) within such further period as the tribunal considers reasonable in a case where it is satisfied that it was not reasonably practicable for the complaint to be presented before the end of that period of three months.
(3) Where an employment tribunal finds a complaint under regulation 4 well-founded, the tribunal
(a) shall make a declaration to that effect, and
(b) may make an award of compensation to be paid by the employer to the crew member.
(4) The amount of the compensation shall be such as the tribunal considers just and equitable in all the circumstances having regard to
(a) the employer's default in refusing to permit the crew member to exercise his right; and
(b) any loss sustained by the crew member which is attributable to the matters complained of."
Non-fishing seafarers
"(4) Where there is a contravention of regulation 12 the employer of the seafarer shall be guilty of an offence punishable on summary conviction by a fine not exceeding level 5 on the standard scale.
(5) In any proceedings for an offence under these Regulations it shall be a defence for the defendant to show that all reasonable steps had been taken by him to ensure compliance with the Regulations."
Whilst I can see how a non-fishing seafarer's employer might expect prosecution for refusing to allow an employee to take his minimum "paid annual leave of at least four weeks" in any leave year, it is more difficult to recognise that the Regulations have in mind that it could be a separate criminal offence for him to give the employee four weeks paid leave per year but at a level of pay that was, say, 10% lower than the level of pay he receives when at work. The Regulations do not spell out what level of holiday pay is to be paid: they merely require that the leave shall be paid leave. The criminal law is required to be certain and employers are entitled to know what they must or must not do to avoid prosecution. We are not concerned with the non-fishing seafarer Regulations. But the Aviation Regulations tell us as much as they do which is nothing about how much holiday pay is required to be paid.
National implementation of the Aviation Directive: preliminary observations
The decision of the Employment Tribunal
"74 the national legislation and practice of determining a week's pay, and therefore 4 weeks' pay during periods of annual leave is that set out in sections 221 224 ERA 1996 which entitles the [pilots] to receive during such periods of leave remuneration comparable to periods of work."
The decision of the Employment Appeal Tribunal
"51 It is nevertheless applicable because it is a formula used throughout industry in the United Kingdom (even if it does not directly apply to mobile staff in civil aviation) and represents a convenient and well-recognised method of calculating annual leave pay in a way which does not infringe the principle of Community law which requires annual leave pay to be comparable, in terms of remuneration, with what such staff are paid when they are working normally."
The submissions on this appeal
"35. The clear purpose of the [Working Time] Directive, as I have said more than once, is to encourage a climate of protection for the working environment and health of workers. So much is clear from its Recitals, some of which I have mentioned. And Article 7, in its provision for Member States to ensure that workers are entitled to at least four weeks' annual leave, clearly has their health in mind. But I do not see upon what basis, it can be said that it requires Member States, in its implementation, to ensure that workers receive more pay during their period of annual leave than that which they were contractually entitled to earn, and did earn, while at work.
36. First, Article 7 expressly qualifies its declaration of workers' entitlement to at least four weeks' paid annual leave to the qualification that such paid leave is to be 'in accordance with the conditions for entitlement to, and granting of, such leave laid down by national legislation and/or practice'. Such conditions necessarily include definition for the basis upon which payment is calculated for such period of leave.
37. Second, and consistently with that qualification, Article 7 is silent as to the level of payment for annual leave to which a worker is entitled. It does not, for example, provide that payment during such leave should equate with a normal week's pay when the worker was at work, or that it should be calculated by reference to 'working time' as defined in Article 2.1. Thus, the European Union has laid down the principle of an entitlement of four weeks' paid annual leave, but has left the conditions of entitlement for implementation by Member states. In leaving Member States that margin of appreciation, it is not for domestic courts to venture a means of calculation that would be contrary to the clear terms of such implementation effected within the margin of discretion allowed by the Directive." (Emphasis supplied)
"58. according to the case law of the Court, the expression 'paid annual leave' in Article 7(1) of [the Working Time Directive] means that, for the duration of annual leave within the meaning of that Directive, remuneration must be maintained and that, in other words, workers must receive their normal remuneration for that period of rest (see Robinson-Steele, paragraph 50).
60. According to the case law of the Court, [the Working Time Directive] treats entitlement to annual leave and to a payment on that account as being two aspects of a single right. The purpose of the requirement of payment for that leave is to put the worker, during such leave, in a position which is, as regards remuneration, comparable to periods of work (see Robinson-Steele, paragraph 58).
61. It follows that, with regard to a worker who has not been able, for reasons beyond his control, to exercise his right to paid annual leave before termination of the employment relationship, the allowance in lieu to which he is entitled must be calculated so that the worker is put in a position comparable to that he would have been in had he exercised that right during his employment relationship. It follows that the worker's normal remuneration, which is that which must be maintained during the rest period corresponding to the paid annual leave, is also decisive as regards the calculation of the allowance in lieu of annual leave not taken by the end of the employment relationship." (Emphasis supplied)
In my view those passages support Miss McNeill's submission as to the Community law interpretation of "paid annual leave" in article 7.1. I shall have to return to the question of whether it follows that "paid annual leave" in regulation 4 of the Aviation Regulations must be interpreted in the like way.
Discussion and conclusion
Disposition
Lord Justice Lloyd :
Lord Justice Ward :