A storm has broken out in the UK over a European Court judgement which has been interpreted as meaning that workers can claim back holiday time lost to illness.

The ruling was given in the context of the Working Time Directive and has implications across the EU, including Malta.

The Confederation of British Industry said the European Court judgment, in a case involving a Spanish council worker, was "open to abuse".

Francisco Pereda, employed by Madrid City Council, launched a legal action after being refused the right to alter his holiday plans because of an injury suffered just before he was due to take annual leave.

The European Court of Justice in Luxembourg ruled that he should have been allowed to alter his holiday dates - including the option to postpone his holiday and take it in the next holiday year.

The case did not involve someone taken ill during their holiday and then demanding compensatory sick leave.

The court ruling made clear that if a "worker does not wish to take annual leave during a period of sick leave, annual leave must be granted to him for a different period".

"Many firms already take a common-sense and sympathetic approach. But allowing employees to reclassify their holiday as sick leave opens the door to abuse," Katja Hall, of the CBI, said.

The EU ruling does not stipulate any time at which an illness could trigger the right to alter holidays, but lawyers examining the EU ruling say the result could be interpreted as giving workers the right to claim extra holiday time even if they have been taken ill after their holiday has begun, the Press Association reported today.

A spokesman for the Malta Employers' Association said the issue was not currently regulated by domestic law. She said that the practice was that a worker who fell sick as he was starting vacation leave was normally granted sick leave but workers who actually fell sick while on vacation leave were not given compensatory vacation leave.

An industrial relations observer said the current practice in Malta was that while workers who fell ill during their company's shut-down were not compensated with extra leave, in other cases, workers on vacation leave who fell sick were normally recognised as being on sick leave as long as a medical certificate was produced.