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You are here: BAILII >> Databases >> United Kingdom Supreme Court >> British Airways plc v Williams & Ors [2012] UKSC 43 (17 October 2012) URL: https://www.bailii.org/uk/cases/UKSC/2012/43.html Cite as: [2012] UKSC 43, [2012] IRLR 1014, [2012] ICR 1375, [2012] WLR(D) 277, [2013] 1 CMLR 31, [2013] 1 All ER 443 |
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Michaelmas Term
[2012] UKSC 43
On appeal from: [2009] EWCA Civ 28
JUDGMENT
British Airways plc
(Respondents) v Williams (Appellant) and others
before
Lord Hope, Deputy President
Lord Walker
Lord Mance
Lord Clarke
Lord Sumption
JUDGMENT GIVEN ON
17 October 2012
Heard on 23 July 2012
Appellant Jane McNeill QC Michael Ford (Instructed by Thompsons Solicitors) |
Respondent Christopher Jeans QC Andrew Short QC (Instructed by Baker and Mackenzie LLP) |
LORD MANCE (with whom Lord Hope, Lord Walker, Lord Clarke and Lord Sumption agree)
Introduction
"(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."
"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 is terminated."
The history of the case to date
"(1) Under (a) articles 7 of Council Directives 93/104/EC and 2003/88/EC and (b) clause 3 of the European Agreement annexed to the Council Directive 2000/79/EC: (i) to what, if any, extent does European law define or lay down any requirements as to the nature and/or level of the payments required to be made in respect of periods of paid annual leave; and (ii) to what, if any, extent may member states determine how such payments are to be calculated?
(2) In particular, is it sufficient that, under national law and/or practice and/or under the collective agreements and/or contractual arrangements negotiated between employers and workers, the payment made enables and encourages the worker to take and to enjoy, in the fullest sense of these words, his or her annual leave; and does not involve any sensible risk that the worker will not do so?
(3) Or is it required that the pay should either (a) correspond precisely with or (b) be broadly comparable to the worker's "normal" pay?
Further, in the event of an affirmative answer to question (3)(a) or (b):
(4) Is the relevant measure or comparison: (a) pay that the worker would have earned during the particular leave period if he or she had been working, instead of on leave, or (b) pay which he or she was earning during some other, and if so what, period when he or she was working?
(5) How should "normal" or "comparable" pay be assessed in circumstances where: (a) a worker's remuneration while working is supplemented if and to the extent that he or she engages in a particular activity; (b) where there is an annual or other limit on the extent to which, or time during which, the worker may engage in that activity, and that limit has been already exceeded or almost exceeded at the time(s) when annual leave is taken, so that the worker would not in fact have been permitted to engage in that activity had he been working, instead of on leave?
"must be interpreted as meaning that an airline pilot is entitled, during his annual leave, not only to the maintenance of his basic salary, but also, first, to all the components intrinsically linked to the performance of the tasks which he is required to carry out under his contract of employment and in respect of which a monetary amount, included in the calculation of his total remuneration, is provided and, second, to all the elements relating to his personal and professional status as an airline pilot. It is for the national court to assess whether the various components comprising that worker's total remuneration meet those criteria."
"20 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 …
21 … remuneration paid in respect of annual leave must, in principle, be determined in such a way as to correspond to the normal remuneration received by the worker. It also follows that an allowance, the amount of which is just sufficient to ensure that there is no serious risk that the worker will not take his leave, will not satisfy the requirements of European Union law."
"that structure cannot affect the worker's right … to enjoy, during his period of rest and relaxation, economic conditions which are comparable to those relating to the exercise of his employment"
and
"24 Accordingly, any inconvenient aspect [sic] which is linked intrinsically to the performance of the tasks which the worker is required to carry out under his contract of employment and in respect of which a monetary amount is provided which is included in the calculation of the worker's total remuneration, such as, in the case of airline pilots, the time spent flying, must necessarily be taken into account for the purposes of the amount to which the worker is entitled during his annual leave.
25 By contrast, the components of the worker's total remuneration which are intended exclusively to cover occasional or ancillary costs arising at the time of performance of the tasks which the worker is required to carry out under his contract of employment, such as costs connected with the time that pilots have to spend away from base, need not be taken into account in the calculation of the payment to be made during annual leave.
26 In that regard, it is for the national court to assess the intrinsic link between the various components which make up the total remuneration of the worker and the performance of the tasks which he is required to carry out under his contract of employment. That assessment must be carried out on the basis of an average over a reference period which is judged to be representative and in the light of the principle established by the case law …, according to which Directive 2003/88 treats entitlement to annual leave and to a payment on that account as being two aspects of a single right...
27 That stated, it must also be pointed out that the court has already held that an employee, working as a purser for an airline company and transferred, by reason of her pregnancy, temporarily to ground work, was entitled, during her temporary transfer, not only to maintenance of her basic salary but also to pay components or supplementary allowances relating to her professional status as an employee. Accordingly, allowances relating to her seniority, her length of service and her professional qualifications had to be maintained: see, to that effect, Parviainen v Finnair Oyj (Case C-471/08) [2011] ICR 99; [2010] ECR I-6533, para 73. That case law also applies to a pregnant worker who has been granted leave from work: see Gassmayr v Bundesminister für Wissenschaft und Forschung (Case C-194/08) [2010] ECR I-6281, para 65.
28 It follows that, in addition to the components of the total remuneration set out in para 24 of the present judgment, all those which relate to the personal and professional status of an airline pilot must be maintained during that worker's paid annual leave."
"in any month
(a) no person … shall act as a crew member during the course of his working time, if during the period of 12 months expiring at the end of month before the month in question the aggregate block flying time of that person exceeds 900 hours; and (b) no crew member employed by him shall have a total annual working time of more than 2,000 hours during the period of 12 months expiring at the end of the month before the month in question".
If a reference period of the previous 10 or 11 months at work were taken, a pilot might in that period have exhausted his or her permitted 900 hours. If an average is in such circumstances to be calculated including all 900 hours, the pilot would (as he or she arguably should) receive paid holiday pay higher than that receivable by a pilot who had only flown 800 hours in the same 10 or 11 months.
The current issues
Analysis on issue of uncertainty and domestic effect
"Remedies
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, 5(1), (4), 7(1) or 7(2)(b).
(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, 5(1), (4), 7(1) or 7(2)(b) 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."
TAFB
Hilary Term
[2010] UKSC 16
On appeal from: [2009] EWCA Civ 281
JUDGMENT
British Airways plc
(Respondents) v Williams (Appellant) and others
before
Lord Walker
Lady Hale
Lord Brown
Lord Mance
Lord Clarke
JUDGMENT GIVEN ON
24 March 2010
Heard on 24 and 25 February 2010
Appellant Jane McNeill QC Michael Ford (Instructed by Thompsons Solicitors) |
Respondent Christopher Jeans QC Andrew Short (Instructed by Baker and Mackenzie LLP) |
LORD MANCE (delivering the judgment of the court)
The relevant law
"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."
"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 is terminated."
The facts
"in any month
(a) no person employed by him shall act as a crew member during the course of his working time, if during the period of 12 months expiring at the end of month before the month in question the aggregate block flying time of that person exceeds 900 hours; and
(b) no crew member employed by him shall have a total annual working time of more than 2,000 hours during the period of 12 months expiring at the end of the month before the month in question".
The issue and submissions
(i)British Airways
' first submission is that (a) the United Kingdom legislator must be taken (when deciding not to enact any detailed provisions to define the nature or amount of the payment to be made during annual leave or to apply ss.221 to 224 of the 1996 Act: see paragraph 9 above) to have intended that the amount of any payment to be made to aviation workers (and non-fishing seafarers) in respect of their annual leave should be determined by collective or individual contractual agreement between the relevant parties; and (b) the domestic legislative intention being in this respect clear, it must prevail, whatever the effect may be of the Aviation Directive.
(ii) Second, however, if and to the extent that, contrary to the first submission, the meaning of the Aviation Regulations can be derived from the Aviation Directive,British Airways
submits that the Aviation Directive is to the same effect.
(iii) (a) Third,British Airways
qualifies its first two submissions only to the extent that it accepts that the payment for annual leave could not, under domestic or European law, be so low as to prevent or inhibit the taking of leave. Pay during weeks of annual leave at the rate of £96,452 per annum or £1,854.85 per week could hardly be said to fall within this qualification. Accordingly,
British Airways
contends that the contractual arrangements between them and their pilots are legitimate.
(b) The appellants' contrary submission of law is that the Aviation Directive requires the payment in respect of annual leave of "normal remuneration" in order to ensure that the worker is on leave in a position which is "comparable" to that when he or she is at work.
(c) There is however disagreement about what this would mean in circumstances such as the present. In particular, on that basis of what "periods" is "normality" or any comparison to be established? And on the basis of what hypotheses? The latter question is relevant where, as may well be the case here, the worker was subject to annual limits which would have precluded him or her from undertaking particular work and receiving particular payments additional to his or her basic salary.
(iv) Fourth,British Airways
submits (in response to this submission by the appellants) that, if the phrase "paid annual leave" involves payment of "normal" or "comparable" remuneration, then, in the present case, payment in respect of annual leave based on the fixed annual remuneration to which pilots are entitled satisfies this requirement.
Analysis
"Once the Council has found that it is necessary to improve the existing level of protection as regards the health and safety of workers and to harmonize the conditions in this area while maintaining the improvements made, achievement of that objective through the imposition of minimum requirements necessarily presupposes Community-wide action, which otherwise, as in this case, leaves the enactment of the detailed implementing provisions required largely to the Member States."
"It is not of course my intention to deny that the expression in question means that reference must be made to national legislation and therefore that the Member States enjoy some latitude in defining the arrangements for enjoyment of the right to leave. In particular, as the Commission also points out, the reference is intended to allow the Member States to provide a legislative framework governing the organisational and procedural aspects of the taking of leave, such as planning holiday periods, the possibility that a worker may have to give advance notice to the employer of the period in which he intends to take leave, the requirement of a minimum period of employment before leave can be taken, the criteria for proportional calculation of annual leave entitlement where the employment relationship is of less than one year, and so forth. But these are precisely measures intended to determine the 'conditions for entitlement to, and granting of, leave and as such are allowed by the Directive. What, on the other hand, does not seem to be allowed by the Directive is for national legislation and/or practice to operate with absolutely (or almost) no restrictions and to go so far as to prevent that right from even arising in certain cases."
"The expression 'in accordance with the conditions for entitlement to, and granting of, such leave laid down by national legislation and/or practice' must therefore be construed as referring only to the arrangements for paid annual leave adopted in the various Member States. As the Advocate General observed in paragraph 34 of his Opinion, although they are free to lay down, in their domestic legislation, conditions for the exercise and implementation of the right to paid annual leave, by prescribing the specific circumstances in which workers may exercise that right, which is theirs in respect of all the periods of work completed, Member States are not entitled to make the existence of that right, which derives directly from Directive 93/104, subject to any preconditions whatsoever."
"58 The 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.
59 Accordingly, without prejudice to more favourable provisions under article 15 of the Directive, the point at which the payment for annual leave is made must be fixed in such a way that, during that leave, the worker is, as regards remuneration, put in a position comparable to periods of work."
The questions referred
(i) Under (a) articles 7 of Council Directives 93/104/EC and 2003/88/EC and (b) clause 3 of the European Agreement annexed to the Council Directive 2000/79/EC: (1) to what, if any, extent does European law define or lay down any requirements as to the nature and/or level of the payments required to be made in respect of periods of paid annual leave; and (2) to what, if any, extent may Member States determine how such payments are to be calculated?
(ii) In particular, is it sufficient that, under national law and/or practice and/or under the collective agreements and/or contractual arrangements negotiated between employers and workers, the payment made enables and encourages the worker to take and to enjoy, in the fullest sense of these words, his or her annual leave; and does not involve any sensible risk that the worker will not do so?
(iii) Or is it required that the pay should either (a) correspond precisely with or (b) be broadly comparable to the worker's "normal" pay?
Further, in the event of an affirmative answer to question (iii)(a) or (b):
(iv) Is the relevant measure or comparison (a) pay that the worker would have earned during the particular leave period if he or she had been working, instead of on leave, or (b) pay which he or she was earning during some other, and if so what, period when he or she was working?
(v) How should "normal" or "comparable" pay be assessed in circumstances where (a) a worker's remuneration while working is supplemented if and to the extent that he or she engages in a particular activity; (b) where there is an annual or other limit on the extent to which, or time during which, the worker may engage in that activity, and that limit has been already exceeded or almost exceeded at the time(s) when annual leave is taken, so that the worker would not in fact have been permitted to engage in that activity had he been working, instead of on leave?