In a recent judgment of the European Court of Justice dated 6 November 2018, the court ruled that a deceased employee's entitlement to financial compensation for untaken paid annual leave may, in principle, pass to the heirs as part of the succession.
Accordingly, under EU law, the heirs of a deceased employee may, in principle, claim financial compensation for the (paid) annual leave that the employee did not take.
If national law excludes such a possibility, the heirs may rely directly on EU law, regardless of whether the employer is a public or a private entity.
Although an employee can no longer make use of periods of relaxation or recreation after their death, the temporal aspect is only one of the two components of the right to paid annual leave laid down in the Charter of Fundamental Rights of the EU. The fundamental right therefore also encompasses an entitlement to pay during leave and an entitlement to financial compensation for annual leave not taken upon termination of the employment relationship.
Source: ECJ
Frequently asked questions
Frequently asked questions
Can heirs claim compensation for unused vacation of a deceased person?
Yes. According to a ruling by the ECJ dated 06.11.2018, a deceased employee's entitlement to financial compensation for unused paid annual leave generally passes to the heirs by way of succession. The heirs may demand financial compensation from the former employer for the outstanding vacation.
Does the heirs' claim to compensation for unused leave also apply against private employers?
Yes. The ECJ clarified that heirs may rely directly on EU law, regardless of whether the employer is a public or private one. If national law excludes such compensation, EU law takes precedence.
Why does the vacation entitlement continue to exist despite the employee's death?
The right to paid annual leave is enshrined in the Charter of Fundamental Rights of the EU and consists of two components: the time off for recreation and the payment during the leave. Even if the recreational component can no longer be realized after death, the financial entitlement remains and can be inherited.
What should heirs do to secure the holiday compensation claim?
Heirs should determine the deceased's outstanding leave entitlement with the former employer and assert the financial compensation claim in writing. If the employer refuses payment citing national law, heirs can proceed further by invoking ECJ case law and EU law.