Both public and private sector employees may be entitled to carry over statutory holiday lost through illness.
UK law expressly prevents carry-over of core statutory holiday entitlement. However, in Pereda (C-277/08) the ECJ ruled that a worker who is sick during statutory holiday should be allowed under EU law to take the holiday at a later date, if necessary in the following holiday year.
The EU ruling applied to public sector employers immediately, but would only affect private employers if extensive wording could be read into the UK regulations. The EAT in Coleman v Attridge  IRLR 10 held that this depends on whether any additional words are compatible with the underlying thrust of the legislation as drafted.
An employment tribunal has now ruled that such wording can and should be read into the UK regulations allowing carry-over in this situation. An employee who broke his ankle before planned holiday and was off sick until after the holiday year ended was entitled to take the holiday in the following year. (Shah v First West Yorkshire, ET 1809311/2009).
This suggests that long-term sick employees on PHI may be able to carry over entitlement for several years.
The decision is only at first instance and so is not binding on other tribunals, although we are aware of at least one other tribunal decision to the same effect. Private sector employers may decide to await an EAT ruling – or government amendments to the regulations – before changing their policy. The government recently updated its BIS website to state that carryover “may” be required in this situation and that it will be consulting on possible amendments to the UK regulations following the ECJ rulings.