Order;Information — ECLI:EU:C:2024:715
Date: 2024-07-24
Language of the case: Italian
Court formation: Sixth Chamber
Subject matter: Approximation of laws;Social Policy;Free movement of workers;Fundamental rights;Charter of Fundamental Rights
Procedure: Reference for a preliminary ruling
Origin: Italy

Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged: 
9 November 2022 
Referring court: 
Tribunale di Oristano (Italy) 
Date of decision to refer: 
21 October 2022 
Applicant: 
S.G. 
Defendant: 
Unione di Comuni Alta Marmilla 
  
Subject matter of the main proceedings 
Application in which the applicant, employed as a manager by a public body, 
seeks to obtain, from the defendant, Unione di Comuni Alta Marmilla, recognition 
of his right to an allowance in lieu of annual leave not taken for reasons alleged 
not to be attributable to him 
Subject matter and legal basis of the reference 
Pursuant to Article 267 TFEU, the referring court asks whether Italian 
legislation – according to which holiday entitlement not taken cannot be replaced 
by payment in lieu – is compatible with Article 31(2) of the Charter of 
Fundamental Rights of the European Union (hereinafter referred to as the 
‘Charter’) and with Article 7(2) of Directive 2003/88/EC 
EN 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-689/22 
 
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Question referred 
Must Article 31(2) of the Charter of Fundamental Rights of the European Union 
and Article 7(2) of Directive 2003/88/EC, also considered separately, be 
interpreted as precluding national provisions or practices, justified by compliance 
with public finance restrictions, under which staff, including managerial staff, of 
public administrative bodies may not under any circumstances, upon termination 
of their employment relationship, be granted monetary benefits in lieu of leave 
accrued but not taken? 
Provisions of EU law cited 
Directive 2003/88/EC of the European Parliament and of the Council of 
4 November 2003 concerning certain aspects of the organisation of working time, 
Articles 7 and 17 
Charter of Fundamental Rights of the European Union, Article 31(2) 
Case-law of the Court of Justice cited 
Judgments of 6 November 2018, C-569/16 and C-570/16, Bauer and Willmeroth, 
ECLI:EU:C:2018:871, paragraphs 43 to 45, 51, 72, 78 and 85; of 6 November 
2018, C-684/16, Max-Planck-Gesellschaft zur Förderung der Wissenschaften, 
ECLI:EU:C:2018:874, paragraphs 22, 23, 45, 46, 68 and 74; of 6 November 2018, 
C-619/16, Kreuziger, ECLI:EU:C:2018:872, paragraphs 30, 31, 52 and 53; of 
24 January 2012, C-282/10, Dominguez, ECLI:EU:C:2012:33, paragraph 27; and 
of 25 November 2021, C-233/20, job-medium, ECLI:EU:C:2021:960, 
paragraphs 30 to 32 
Provisions of national law cited 
Article 36 of the Italian Constitution: ‘(…) Workers have the right to weekly rest 
and paid annual leave and cannot waive this right’. 
Article 10 of Decreto legislativo (Legislative Decree) No 66 of 8 April 2003 – 
Implementation of Directives 93/104/EC and 2000/34/EC concerning certain 
aspects of the organisation of working time: ‘(…) Workers are entitled to a 
minimum of four weeks’ paid annual holiday. At least two of these weeks, unless 
otherwise specified in the collective bargaining agreement or specific regulations 
referring to the categories stated in Article 2(2), must be taken, consecutively at 
the employee’s request, during the year in which they accrue and the remaining 
two weeks within the 18 months from the close of the reference year. This 
minimum period of four weeks may not be replaced by an allowance in lieu of 
leave not taken, save where the employment relationship is terminated. (…)’. 
UNIONE DI COMUNI ALTA MARMILLA 
 
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Article 5 of Decreto-legge (Decree-Law) No 95 of 6 July 2012, converted with 
amendments by Law No 135 of 7 August 2012, on ‘Urgent provisions for the 
public spending review with unmodified services to citizens’, entitled ‘Reduction 
of spending by public administrations’, paragraph 8: 
‘Holidays, rest periods and leave entitlement of staff, including managerial staff, 
of public administrative bodies included in the consolidated income statement of 
the public administration, as identified by the National Statistics Institute 
(ISTAT), must be taken in accordance with the provisions of the respective 
regulations and shall not give rise, under any circumstances, to an allowance in 
lieu of leave. This provision also applies in the event that the employment 
relationship comes to an end as a result of labour mobility, resignation, 
termination, retirement or attainment of the age limit. Any more favourable 
statutory and contractual provisions shall cease to apply from the entry into force 
of this decree. Any breach of this provision, in addition to permitting amounts 
unduly paid to be recovered, will also expose the manager responsible to 
disciplinary and administrative liability. (…)’. 
Brief description of the facts and procedure 
1 On 25 January 2021, G.S. brought an action against Unione di Comuni Alta 
Marmilla, claiming that he had worked for the body until his retirement on 
reaching the age limit, as a full-time manager on an open-ended term basis, and 
that he had found himself unable to take his accrued leave due to the serious staff 
shortage affecting the public body and the considerable number of work-related 
tasks for which he was responsible as the sole manager, being required to attend 
the workplace at all times as his absence would have brought operations to a halt. 
2 The Unione di Comuni Alta Marmilla (Union of Municipalities of Alta Marmilla) 
entered an appearance, contesting the basis of the claim and pleading that the 
application should be dismissed. 
The essential arguments put forward by the parties in the main proceedings 
3 The applicant claims that the employer had never invited him to take his holiday 
leave, had not warned him that otherwise he would forfeit it, nor had it facilitated 
him to do so; he therefore sought to establish that he had not taken his leave for 
reasons that were not attributable to him and to obtain an allowance in lieu of 
leave not taken, on the basis of Article 7(2) of Directive 2003/88, calculated at 
75 days or, alternatively, 56 days. 
4 The defendant Administration argues that it had in fact adopted a plan to reduce 
the backlog of leave and that it had not imposed service requirements on the 
employee that prevented him from taking his annual leave; as a point of law, it 
referred to a restrictive approach taken in national case-law, according to which 
the interested party has the burden of proving service requirements or force 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-689/22 
 
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majeure; it also pointed out a further obstacle created by Italian legislation, under 
Article 5(8) of Decree-Law No 95 of 6 July 2012, according to which staff of 
public administrative bodies are not entitled to an allowance in lieu of leave not 
taken. 
Brief description of the grounds for the reference 
5 As regards the admissibility of the matter, the referring court observes that this 
case, which is of particular importance and has considerable financial 
implications, is not identical to those similar cases already resolved by the Court 
of Justice, since the interpretation given up to now has not related to the national 
legislation at issue in the main proceedings, and the solution, in the light of the 
specific nature of the case, is not evident from the existing case-law, given the 
concurrent requirements in supranational law of protecting the rights of workers, 
including those employed by public bodies, and of safeguarding public finances. 
6 As regards relevance, the referring court observes that a preliminary ruling 
appears to be necessary, for the purposes of resolving the dispute, as the main 
proceedings cannot be settled unless a ruling has been made regarding the 
interpretation, in this case, of EU law. 
7 In order to define accurately the terms of the question referred for a preliminary 
ruling, the court asserts that it should commence with the line of authorities from 
the Court of Justice of the European Union concerning the right to paid annual 
leave. 
8 Regarding the legal basis, the Court of Justice has stated that ‘the right to paid 
annual leave, as a principle of EU social law, is not only particularly important, 
but is also expressly laid down in Article 31(2) of the Charter, which Article 6(1) 
TEU recognises as having the same legal value as the Treaties’. ‘Article 7(1) of 
Directive 2003/88’, the reference provision, ‘imposes on Member States, in 
unequivocal terms, a precise and absolutely unconditional obligation regarding the 
application of the rule set out therein’ and ‘therefore fulfils the conditions required 
to produce direct effect’, which can be invoked in a dispute with an employer 
which has the status of a decentralised public authority. ‘Article 7 of Directive 
2003/88 cannot’, on the other hand, due to the nature of the directive, ‘be invoked 
in a dispute between individuals in order to ensure the full effect of the right to 
paid annual leave and to set aside any contrary provision of national law’. ‘The 
right to a period of paid annual leave, affirmed for every worker by Article 31(2) 
of the Charter, is’, thus, ‘both mandatory and unconditional in nature’. ‘It follows 
that the aforementioned provision is sufficient in itself to confer a right upon on a 
worker that he or she can actually rely on in a dispute against his or her 
employer’, even if the latter has the status of private individual (judgments of 
6 November 2018, C-569/16 and C-570/16, Bauer and Willmeroth, 
ECLI:EU:C:2018:871, paragraphs 51, 72, 78 and 85, and of 6 November 2018, 
UNIONE DI COMUNI ALTA MARMILLA 
 
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C-684/16, Max-Planck-Gesellschaft zur Förderung der Wissenschaften, 
ECLI:EU:C:2018:874, paragraphs 68 and 74). 
9 With regard to the substantive law, the Court of Justice has affirmed that ‘upon 
termination of the employment relationship, the paid annual leave to which a 
worker was entitled can no longer be taken. It is in order to prevent this restriction 
from leading to a situation in which the worker loses the benefit of that right, even 
in pecuniary form, Article 7(2) of Directive 2003/88 provides that the worker is 
entitled to an allowance in lieu for the days of annual leave not taken. That 
provision lays down no condition for entitlement to an allowance in lieu other 
than that relating to the fact that, firstly, the employment relationship has ended 
and, secondly, that the worker has not taken all the annual leave to which he or 
she was entitled on the date on which that relationship came to an end. Thus, the 
reason for which the employment relationship is terminated is not relevant’ 
(judgments of 6 November 2018, C-569/16 and C-570/16, Bauer and Willmeroth, 
ECLI:EU:C:2018:871, paragraphs 43 to 45; of 6 November 2018, C-619/16, 
Kreuziger, ECLI:EU:C:2018:872, paragraphs 22, 30 and 31; of 6 November 2018, 
C-684/16, Max-Planck- Gesellschaft zur Förderung der Wissenschaften, 
ECLI:EU:C:2018:874, paragraphs 22 and 23; and of 25 November 2021, 
C-233/20, job-medium, ECLI:EU:C:2021:960, paragraphs 30 to 32). ‘In view of 
the mandatory nature of the entitlement, the employer is, in particular, required to 
respect the right to paid annual leave and, in order to guarantee the effectiveness 
of Article 7 of Directive 2003/88, to ensure’, specifically and transparently, ‘that 
the worker is actually given the opportunity to take the paid annual leave to which 
he or she is entitled, by encouraging him or her, formally if need be, to do so, 
while informing him or her’, in good time, ‘that, if he or she does not take it, it 
will be lost at the end of the reference period or authorised carry-over period, or 
upon termination of the employment relationship if the termination occurs during 
such a period’; moreover, ‘the burden of proof in that respect is on the employer’ 
and the latter must be able to ‘show that it has exercised all due diligence in order 
to enable the worker to actually take the paid annual leave to which he or she is 
entitled’ (judgments of 6 November 2018, Case C-619/16, Kreuziger, 
ECLI:EU:C:2018:872, paragraphs 52 and 53; of 6 November 2018, C-684/16, 
Max-Planck-Gesellschaft zur Förderung der Wissenschaften, 
ECLI:EU:C:2018:874, paragraphs 45 and 46). 
10 In short, according to EU law, the employee’s inertia in requesting leave is 
irrelevant, as is the employee’s desire to terminate the relationship, since the 
employer is obliged to allow the employee to take leave in the year in which it 
accrues or, in any case, before the end of the working relationship, by enabling 
him or her to avail himself or herself of his or her right in good time and otherwise 
preventing him or her from suffering prejudice, by means of compensation of an 
equivalent sum of money, commensurate with his or her daily wage; in legal 
proceedings, the employer always bears the burden of proving that it has 
diligently fulfilled its organisational and informative obligations towards the 
employee. 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-689/22 
 
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11 The referring court, going back to national law, then states that, with the entry into 
force of Article 5(8) of Decree-Law No 95 of 6 July 2012, a change was made to 
domestic law with respect to the regime described in Article 10 of Italian 
Legislative Decree No 66 of 8 April 2003. This decree-law differs from European 
legislation, with regard solely to the regulation of public operations. In fact, the 
period of leave to which staff, including managers, of all public administrative 
bodies are entitled, but which has not been taken, no longer, ‘under any 
circumstances’, entitles them to payment in lieu of leave. This rule, which is 
highly restrictive, is considered to be of a special, imperative nature, as it has been 
recognised as taking precedence over any regulatory or contractual provisions 
more favourable to public employees, and also provides that non-compliance with 
the rule exposes a manager to disciplinary and administrative liability, and 
represents an underlying condition to the recovery of undue payments. 
12 The new regime dispenses with all exceptions to the prohibition, however limited, 
and prevents the courts from assessing whether the failure to take leave can be 
attributed to non-performance or unlawful conduct on the part of one of the 
parties, whether employer or employee. 
13 Ruling on the new regulation, the Corte Costituzionale (Italian Constitutional 
Court) has held that the prohibition on replacing holiday entitlement not taken 
with a payment in lieu cannot disregard the ‘civil law remedy of compensation for 
damage caused by non-use on grounds beyond the employee’s control’ (judgment 
no 286 of 4 December 2013); it subsequently rejected the issue of constitutional 
legitimacy, on the assumption that the prohibition does not apply when the worker 
was not able to enjoy the right to leave due to illness or other grounds not 
attributable to him or her, since the prohibition is intended only ‘to encourage a 
rational scheduling of holiday periods’, ‘without causing prejudice to a worker not 
at fault’, also because a sectoral regulation, aimed at curtailing a possibly distorted 
use of payment in lieu, cannot conflict with principles rooted in Italian and 
European law (judgment no 95 of 6 May 2016). 
14 The Corte di Cassazione (Italian Court of Cassation), when called upon to rule on 
the new norm, sought an interpretation in line with European principles. Firstly, it 
held that the provision could not nullify the right to payment in lieu of leave not 
taken on ‘grounds not attributable to the employee’, raising the question of the 
employer's breach of its organisational obligations. 
15 The attempt to overcome the conflict between the rules by means of interpretation 
does not, however, appear to be wholly conclusive. 
16 According to the Court of Justice, ‘the principle that national law must be 
interpreted in conformity with European Union law’, in the widest sense, ‘also 
requires national courts to do whatever lies within their jurisdiction, taking the 
whole body of domestic law into consideration and applying the interpretative 
methods recognised by domestic law’ (judgment of 24 January 2012 in Case 
C-282/10, Dominguez, ECLI:EU:C:2012:33, paragraph 27). 
UNIONE DI COMUNI ALTA MARMILLA 
 
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17 The Corte Costituzionale has always held that the so-called ‘constitutionally 
compatible interpretation’ is impeded by the ‘literal wording of the provision’ 
(judgment no 204 of 21 July 2016). In the case in question, the interpretation in 
conformity with EU law is faced with the insuperable limitation of the literal 
wording of the domestic legislative regulation, which is strict and radical, in so far 
as it provides that ‘[not] under any circumstances’, with regard to civil servants, 
can monetary benefits be granted in lieu of leave not taken, even where the 
employee has not taken that leave for reasons beyond his or her control. 
18 Once it has been established that it is impossible to proceed with an interpretation 
that is consistent with EU law, the national regulation that is in conflict with that 
law must be set aside. 
19 Nevertheless, in order to proceed with setting aside that provision, it is necessary 
to clarify, in advance and definitively, whether the conflict between the provision 
contained in Article 5(8) of Decree-Law No 95 of 6 July 2012, on the one hand, 
and those contained in Article 31(2) of the Charter and in Article 7(2) of Directive 
2003/88, on the other, is not precluded by the purpose, possibly legitimate in 
itself, that is pursued by the national provision. This provision may in fact be 
justified by compliance with other restrictions arising from Italy’s membership of 
the European Union, more precisely, those of a financial nature, essentially 
attributable to the prohibition on Member States incurring excessive deficits, laid 
down by Article 126 TFEU and specified in Protocol No 12 on the excessive 
deficit procedure. In fact, the exclusion of the allowance in lieu of leave not taken, 
upon termination of the relationship, could exceptionally be regarded as justified 
in the case of a public administration which, after satisfying obligations to cut 
down on payroll costs and obtaining a balanced budget for a number of years, also 
by limiting new recruitments, has found itself in a situation where it is absolutely 
impossible to replace an employee, over the period necessary to ensure that that 
employee can take the leave to which he or she is entitled, and to run the offices in 
his or her absence in any other way than by suspending the services offered to the 
community. In such a case, however, the public employer would have to provide 
conclusive proof of the gradual reduction of staff and timely scheduling of service 
requirements, with a view to the recruitment of one or more replacements, within 
the limits of the expenditure budget, so as to ensure administrative continuity and 
avoid institutional paralysis. 
20 Even though it does not appear legitimate to restrict the protection of an employee 
in the civil service sector in this manner, the referring court takes the view that it 
cannot establish what is an appropriate balance, in supranational law, between 
financial interests, to which the set of measures aimed at the gradual reduction of 
staff expenditure refers, and social and economic interests, to which the protection 
of the right to paid annual leave in equivalent terms relates.