After recognizing in September 2023 that employees on sick leave are entitled to accrue paid leave, the French Supreme Court has now recently ruled that paid leave must be taken into account when calculating the threshold for overtime, meaning that an employee subject to weekly working time calculations can claim overtime pay even if they have not worked 35 hours due to paid leave during that week.

In a second ruling, the French Supreme Court also decided that employees who fall ill during their holiday are allowed to carry over that holiday.

Let us review this latest decision:

1. The context and justification for the decision:

In a ruling dated 10 September 2025, and in a reversal of previous case law, the French Supreme Court ruled that an employee who falls ill and takes sick leave during their holiday is entitled to have the holiday days coinciding with the sick leave postponed, provided that the employee notifies their employer of the sick leave.

This decision therefore puts an end to case law which, until now, denied employees who fell ill during their holidays the right to postpone the leave they were unable to take due to their sick leave, giving precedence to the primary cause of the suspension of the contract, namely holidays.

However, this solution was contrary to European law, which considered that the purpose of the right to holidays was different from that of sick leave and that the two periods could therefore not be confused.

On 18 June 2025, the European Commission issued a formal notice to France to align itself with the European position, which the French Supreme Court has now done with this decision.

The reasoning of the court is simple and based on the purpose of each type of leave:

  • Holiday is intended to allow employees to rest, relax and enjoy leisure activities;
  • Sick leave is intended to allow employees to recover their health and get better.

The only condition required by the French Supreme Court to allow holiday days to be carried over is that the employee must notify their employer of their sick leave.

Since this decision, the French Ministry of Labour updated its practical guide to paid leave on 17 September 2025, adding that when holiday days that coincide with sick leave are carried over, the rules relating to the carry-over of paid leave in the context of illness must be respected and the employer must follow the procedure for informing the employee. In practical terms, this means that if an employee on sick leave during their holiday is unable to take all or part of their accrued leave during the leave period, they are entitled to a 15-month carry-over period in order to use it as provided for in the French Labour Code. At the end of the period of sick leave, the employer must therefore provide the employee with the following information within one month of their return to work, by any means that provides a definite date of receipt, such as through a payslip:

  • the number of days of leave available to them; and
  • the date by which these days of leave must be taken.

2. Issues raised by the decision

Although the principle established by the French Supreme Court appears straightforward, it does not answer all the practical questions that arise from it, which will have to be decided at a later date by the courts of first instance. In particular:

  • What about the retroactive effect of the decision? According to some commentators, the decision would apply retroactively to past situations, provided that the employee had notified the employer of any sick leave taken during the holiday period. This would mean that it would apply both (i) to employees whose employment contract is still in force and (ii) to those whose employment contract has been terminated, the latter being able to claim paid holiday compensation.
  • Applicable limitation periods would be three years for claims for paid holiday compensation and two years for claims in kind.
  • Furthermore, the ruling of 10 September 2025, which specifically refers to holidays, is silent on its possible application in the event of sick leave during Reduction of Working Time (RTT) days or other types of paid leave.

3. What impact will this decision have on employers?

For some companies that have already applied the rule of carrying over holidays, this decision should have no impact. The French Ministry of Labour had already invited companies to comply with European legislation since February 2024.

For others, this decision appears to generate additional costs as employers will have to modify their leave and payroll management policies and update their absence management software.

One might also wonder whether this decision will undermine current efforts to combat abusive sick leave.

As things stand, from a practical point of view, employers should apply the decision immediately to all sick leave taken after the decision (limiting deferrals to holidays only) and deal with past requests on a case-by-case basis.