These conjoined cases involved the same legal issues that were referred to the Court of Justice for the European Union from the Bulgarian and Italian courts respectively.  In QH, the claimant was a former employee in a school in Bulgaria who was dismissed, but the dismissal was regarded as unlawful and she was reinstated.   In CV, the claimant was an employee of an Italian credit institution, where she had been dismissed, but it was also declared unlawful and she was reinstated.  In both events, they were then subsequently dismissed again.  The issue that arose with both was whether they were entitled to paid annual leave for the point between the first dismissal and the reinstatement.

The legal question concerned the application of Article 7 of the EU Directive 2003/88/EC on the implementation of Working Time.   This merely states that Member States must ensure that every worker is entitled to paid annual leave of at least four weeks.

The CJEU referred to their decision in Dica where they affirmed that where a worker is unable to perform their duties due to some unforeseeable reason that is beyond their control the right to annual leave cannot be conditional upon actually working.   Applying that interpretation, where the worker has been dismissed unlawfully that should be regarded as unforeseeable and beyond their control.

For that reason, any period between dismissal and reinstatement should be assimilated to a period of actual work for properly determining the entitlement to paid annual leave.   As was seen in both of these cases, where the employment relationship is then subsequently terminated after the reinstatement then the worker will be entitled to payment in lieu of any paid annual leave that has not been taken.

Furthermore, the CJEU outlined that if the worker has taken on new employment between the dismissal and reinstatement they will be able to claim the entitlement only from the new employer and it will not accrue with the previous employer.  It was interesting that the CJEU noted that within the Italian case, when the reinstatement occurred on foot of an unlawful dismissal, it was as if the employment relationship did not end and the dismissal was void ab initio. Accordingly, for that reason it was abundantly clear that the entitlement to annual paid leave would continue to accrue even when the employee was in a state of unlawful dismissal.

Practical Lessons: This case from the CJEU demonstrates the wide interpretation given to the entitlement to paid annual leave within the Directive Concerning Aspects of the Organisation of Working Time.   When it comes to an unfair dismissal that leads to reinstatement, it is clear that the entitlement for annual leave will continue to run as if the dismissal had never taken place.   Accordingly, where reinstatement is ordered, those employers should be cognisant of the annual leave entitlement of the reinstated employee.

https://curia.europa.eu/jcms/upload/docs/application/pdf/2020-06/cp200076en.pdf