Court of Cassation ruling of September 13, 2023

Published on December 12, 2023

Business Law

It is now possible to acquire paid leave during sick leave

In Brief

> According to Article 31(2) of the Charter of Fundamental Rights of the European Union, "Every worker has the right to a limitation of maximum working hours, to daily and weekly rest periods, and to an annual period of paid leave."

> The right to paid annual leave is an essential principle of EU social law (CJEU 6 November 2018).

> Regarding an employee whose employment contract is suspended due to a work stoppage for non-occupational illness, the provisions of Article L.3141-3 of the Labor Code, which make the right to paid leave conditional on the performance of actual work, do not allow an interpretation consistent with Union law.

> The provisions of Article L. 3141-3 of the Labor Code are set aside because they are not in conformity with the aforementioned European Union law. Any employee whose employment contract is suspended due to a work stoppage for illness may claim their paid leave rights for this period.

Previously

Principle: an employee is entitled to two and a half days of leave per month of actual work.
Certain periods are treated as actual work, notably an uninterrupted period of one year during which an employee's contract is suspended due to a work accident or occupational disease (Article L3141-5 of the Labor Code).
Effects:
An employee on leave due to a work accident or occupational disease acquires paid leave rights that they can carry over after the suspension of the contract.
An employee whose contract was suspended for a non-occupational reason lost their right to acquire paid leave. Unused leave at the end of the reference period was forfeited.

Now

Alignment of French law with European Union law regarding paid leave.
In the event of a work accident or occupational disease, the acquisition of paid leave days is no longer limited to one year.
Alignment of the regime for non-occupational sick leave with the regime for occupational sick leave regarding the acquisition of paid leave. Any sick leave now entitles the employee to paid leave.
The statute of limitations for the right to paid leave only begins to run when the employer has enabled the employee to exercise it in a timely manner.
At the end of the reference period, the employee who has not been able to benefit from their paid leave may carry it over after the suspension of the contract. The duration during which the leave may be carried over has not been decided by the Social Chamber.

Litigation risk

The litigation risk is low for employees who have had short-term sick leave periods.
The risk of litigation is higher for employees who have experienced a long period of suspension of contract due to a work stoppage for non-professional reasons.
The rulings of the Court of Cassation are silent regarding claims for the acquisition of additional paid leave acquired under a collective agreement or company agreement.
According to Article L. 3245-1 of the Labor Code, an action for payment or recovery of wages is barred after three years from the day the claimant knew or should have known the facts, or, when the employment contract is terminated, from the three years preceding the termination of the contract.

Prescription

The starting point of the limitation period is set on the day of the expiration of the legal or contractual period during which the paid leave could have been taken, could should have been taken, provided that the employer guaranteed the effectiveness of the right to such leave. In the absence of setting and steps incumbent upon the employer legally (request to take leave; postponement… date from which the judge can set this starting point), no starting point exists.
Without a starting point for the limitation period, it is unenforceable against the employee, whose action becomes imprescriptible.
Caution:
The ruling of September 13, 2023, No. 22-10.529 confirmed the granting of paid leave compensation over a period of ten years, considering that the employer had not carried out the necessary steps to guarantee the employee's right to paid leave, a central point of imprescriptibility.
However, in the specific facts of the case, the relationship between the parties was reclassified as an employment contract before the trial judges. Thus, the employer's diligence could not be established. In practice, the provisions of Articles D. 3141-5 and R. 3243-1 of the Labor Code are considered diligent.
Finally, the action is time-barred as soon as no starting point for the limitation period can be determined. Moreover, the acquisition of paid leave days can target go back over many years if it is established that the employer did not carry out the necessary steps to guarantee the employee's right to paid leave.

Recommendations

For companies, this involves updating payroll procedures to allow the acquisition of paid leave days for all employees on sick leave, regardless of the cause (occupational or not).
As for employees who are now creditors of paid leave, it is preferable to wait for them to come forward, limiting oneself to the three-year statute of limitations.