As widely expected, the House of Lords, in its judgment in the Stringer case has confirmed that workers on authorised sick leave continue to accrue their statutory holiday entitlement. It has also ruled that workers are entitled to use the unlawful deduction from wages provisions of the Employment Rights Act to enforce their rights to paid leave, in addition to their parallel remedies under the Working Time Regulations. The advantage for workers of claiming under the former legislation is a more generous time limit for bringing a claim where there has been a "series" of deductions.
However, the House of Lords has done little to unravel the practical implications of allowing sick workers to accrue leave. It appears that the prohibition on carrying forward the core four-week entitlement still stands, as does the stipulation that paid holiday can only be replaced with a payment in lieu on termination of the worker's contract. That means that, in practice, workers need to ask for and take their annual leave while they are off sick if it would otherwise be lost. There may be exceptions to this general rule, but without further litigation we cannot be certain what they are. A full briefing on the Stringer case can be accessed here.