Unlawful dismissal for exceeding grace period if employer denied vacation time

26 October 2023

It is unlawful to dismiss an employee on the grounds of exceeding his grace period if the employer refuses to allow him to take his accrued leave without valid reasons justifying the refusal before the grace period ends.

The case before the Court examines the dismissal of an employee for exceeding his grace period, which was found to be unlawful by the Court of First Instance and the Court of Appeal.

Specifically, during the period of illness, before exceeding the grace period, the employee had asked the employer to use his accrued leaves and anticipated that if he was unable to return to work, he intended to request a period of unpaid leave.

The employer had refused the request to use the leave period, instead authorising the employee to take a period of unpaid leave, explaining that the accrued and unused holidays would have been liquidated to the employee in the event of dismissal if, after the unpaid leave, the employee did not return to work.

Upon the expiration of the grace period, due to the continuation of the illness, the employer notified the employee of the dismissal for exceeding the grace period.

The Court of Appeal confirmed the decision of the lower Court, stating that the dismissal was unlawful because the company had rejected the employee's request to use his accrued leaves, which the employee had made to avoid exceeding the grace period.

The Supreme Court, with the decision no. 26997 of Sept. 21, 2023, upheld the ruling, noting that an employee absent due to illness may request to take leave to suspend the running of the grace period, as, in the case at issue, there is no inconsistency between illness and vacation, and the employer must grant such leave unless it has serious reasons justifying its refusal. The employer must properly assess the employee's position, as the employee is at risk of dismissal.

In the case investigated, as there were no legitimate reasons for the denial of the leave requested, the Supreme Court dismissed the appeal brought by the Company, confirming the unlawfulness of the dismissal served by the employer.