Holiday Pay Is A Matter of Life AND Death, EU’s Top Court Rules

The European Union’s top court ruled Tuesday that, when an employee dies without having claimed all their paid annual leave, their heirs should get a payout from the employer in lieu of the holiday that wasn’t—and never will be—taken.

The Court of Justice of the European Union (CJEU) issued the ruling in the joined cases of two German widows, who had tried to claim allowances from their deceased husbands’ employers in lieu of the vacation they hadn’t taken—but to which they were entitled—at the point they passed away.

The employers refused, and Germany’s Federal Labor Court asked the CJEU to interpret EU law on the matter.

Under EU law, all workers are entitled to at least four weeks’ paid leave per year, and employers can only offer extra money instead if the employment relationship is terminated. The CJEU ruled four years ago that the right to paid leave does not suddenly vanish when someone dies, but German law still says a payout in lieu of that vacation time cannot form part of someone’s estate.

Never mind what German law says, the CJEU ruled Tuesday—EU law takes precedence.

“By today’s judgment, the Court confirms that, under EU law, a worker’s right to paid annual leave does not lapse upon his death,” the court said. “In addition, it states that the heirs of a deceased worker may claim an allowance in lieu of the paid annual leave not taken by the worker. In the event that national law precludes that possibility and is therefore incompatible with EU law, the heirs may directly rely on EU law, both against a public and a private employer.”

The German system is based on the idea that paid annual leave is designed to give people the opportunity to kick back, and leisure isn’t really possible if you’ve shuffled off this mortal coil. However, the CJEU said, paid annual leave—a fundamental right in Europe—is also about money, and “is therefore intended to form part of the assets of the person concerned.”