Tuesday 20 January 2009

Just What We Need Right Now

As if running a business isn't difficult enough, the European Court of Justice has weighed in with this sledgehammer.

Britain's hard-pressed businesses suffered another damaging blow today when EU judges ruled that employees off sick will still be entitled to paid holidays.
It means that staff can take their annual leave built up while at home immediately they return to work.
In addition, any worker sacked or who leaves a firm while off ill must be financially compensated in lieu of the holidays not taken.

So, as well as sickness pay, which is paid at full salary by many firms, this means that some of those days will now effectively be double pay. With no useful value arising for the company doing the paying. I can imagine quite a few businesses reviewing their policy in the light of this and offering SSP only.

Maybe there can be a compromise or something, I'm sure the EU want European businesses to be globally competitive after all.

The European Court of Justice verdict ... cannot be appealed

OK. Maybe not.

Their verdict applies only to the 20 days' annual leave required by law under the EU working time directive.

However, the UK statutory minimum holiday allowance is 24 days and Law Lords, who are bound by the European ruling, will now decide whether to extend the benefit accordingly. Their decision is expected within weeks.

Remember that the current 24 days is increasing to 28 days from April this year.

I run a business and even reclaiming SSP is extremely rare. Legally you have to pay at least that and can only reclaim if it exceeds a percentage of your NI sum to HMRC. You would require a real epidemic of long-term illness to even get that.

In a caring society, that is just about understandable, although a drain on industry which, if Government want to care about employees, should be better funded for the businesses involved. However, this new ruling just puts another (unfair IMO) heavy burden on businesses.

This isn't Government money, or EU money we are talking about. All of these rules tell businesses how much of their own profits they should pay. Government like spending other people's money, it seems.

This, of course, on top of the massive increase in bureaucracy and red tape that has accrued since 1997. I think you know what happened then.

H/T Old Holborn

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