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The case of King v Sash Windows Workshop Ltd considered whether a ‘worker’, who had previously been considered to be self-employed, should be allowed to carry their resultant holiday pay into a new holiday year.
The European Court of Justice said that when an employer has failed to offer paid holiday to a worker, this right can be carried over until the paid holiday is offered to them. If not, they will be owed payment in lieu of all the accrued holiday when the employment is terminated.
This means that if a self–employed contractor can claim ‘worker’ status they can claim pay in respect of unpaid annual leave going back a number of years. Uber, for example, could face claims from 40,000 drivers based on their worker status.
The ECJ has made it clear that it is up to employers to get this right or face the consequences, which could be a significant holiday back-pay liability.