An article under the above heading was published in our last newsletter, and I have received a large number of enquiries asking for certain points to be clarified.

Point 1.  – The annual leave cycle.

The BCEA states ( section 20 (1)  that the annual leave cycle is the period of 12 months calculated from the first day of employment, or from the end of the previous leave cycle.

Point 2. The minimum number of days to which the employee is entitled on full pay.

The BCEA states ( section 20 ( 2) (a) ) that the employee is entitled to 21 consecutive days per annum on full pay.  Reference to the calendar will show that, if the employee works a 5 – day week, then the entitlement is in fact 15 working days on full pay. If the employee works  6-day week, then the entitlement is 18 working days leave on full pay. Put differently, the employee’s entitlement is the number of normal working days that falls within a period of 21 consecutive days. Days worked as overtime are excluded from this calculation.

Point 3. Public Holidays.

Should a public holiday fall during a period when the employee is on annual leave, then he./she is awarded an extra day paid leave for each public holiday falling within the period of leave.

Point 4 The accumulation of annual leave days.

The BCEA states  (section 20 (2) (b) and (c) that, by agreement,  the annual leave entitlement accrues to the credit of the employee at the rate of 1 day for every 17 days  on which the employee worked or was entitled to be paid. Or, again by agreement,  1 hour leave for every 17 hours on which the employee worked or was entitled to be paid.

What this means is that public holidays (the employee is at home but is entitled to be paid ) will be included in the calculation of “every 17 days.” The same applies if the employee is off work on paid sick leave.  It is not a day on which he worked, but he is entitled to be paid.

Therefore days off on paid sick leave will also be included in the calculation of “every 17 days.” Very few employers apply the “1 hour for every 17 hours worked etc” so we won’t go into that one – but the principle is the same. Most commonly, employers accrue annual leave at the rate of 1,25 days per month, ignoring the bit about “on which the employee worked or was entitled to be paid.”

Point 5.  When must the employee take his annual leave ?

The BCEA is silent on this question – there is nothing stipulated in legislation to state that annual leave must be taken not later than a certain point within or after the leave cycle.

What is stated is that:

1. The employee is entitled to take leave accumulated in an annual leave cycle on consecutive days. This means that the employee, at the end of his leave cycle, can apply for his 21 consecutive days leave or 15 working days leave, and the employer cannot refuse it to be taken in one lump.

The employer cannot say to the employee “We can only let you have one week now and you can take one week later and then one week after that.” Not acceptable. The employee is entitled to say “I want all my leave at one time – cheers!”

This of course only applies to leave accumulated in terms of the Act – namely to the statutory 21 consecutive days. If the employee has been permitted to accumulate leave in excess of that amount, he can only demand 21 consecutive days in one parcel.

Point 6.  The 6 month limit ???

The BCEA states ( section 20 (4) that “an employer must grant annual leave not later than six months after the end of the annual leave cycle.” This does not mean that the employee must take any outstanding leave within 6 months of the end of the cycle.

It means quite simply that should the employee apply to take his outstanding leave (or a portion of it)   within the period of 6 months after the end of the cycle, then the employer must grant it – he cannot refuse that request for leave.

If the employee does not apply to take any outstanding leave, this stipulation does not mean that the employer must force the employee to take it. What are the implications here ?? Very simply, this means that the employee may accumulate leave, and add it up year upon year, unless the employer prohibits such a practice in his Annual Leave Policy.

 Point 7  What about “use it or lose it” ?

Why can the employer not insist that employees take their leave within a certain period, or they must forfeit it ? Simply because the Act entitles the employee to accumulate a certain amount of paid leave over a certain period of time.

This is the employee’s right and his legal entitlement. The employer is not empowered under any Act of Parliament to deprive the employee of this legal entitlement. However, this legal entitlement is only in respect of 21 consecutive days – anything past that is not regulated by labour law.

And this is probably the biggest incentive for employers to put in place a company Annual Leave Policy. If an employer grants his staff 20 working days leave per annum on full pay, those extra 5 days are not subject to any legislation.

The employer therefore would be entitled to stipulate that those 5 days must be taken by a certain date or within a certain period, and if the employee does not comply then those 5 days can be forfeited – or taken away – by the employer. Nothing wrong with that. But a similar principle may not be applied to the statutory entitlement of 21 consecutive days.

Point 8.  How much leave then may be accumulated ?

The BCEA is silent on this matter, and obviously the legislature did not presume to tell employers how to control things like annual leave. The Act lays down the rules – the employer must attend to the proper administration of those rules and put those rules into effect.

Put differently, the Act states “ these are the rules – how you apply them is up to you – as long as the rules are properly observed, you can apply them any way you wish.”  The employee may accumulate as much leave as the employer will allow him to accumulate.

Therefore, if there is no Annual Leave Policy in place or no rule in place prohibiting the accumulation of annual leave, then it may be accumulated. Employers must put such rules in place, namely to stipulate the maximum number of days that the employee may accumulate, and within what time period the leave must be taken.

For example, the employer may stipulate that at least 10 working days leave must be taken on consecutive days within or by the end of the current leave cycle, and the remaining 5 working days must be taken within 6 months of the end of the leave cycle.

It is the duty of the employer to carefully monitor leave usage, and to inform staff, say with 2 months notice,  “you have 5 days leave due and this must be taken by 31^st March (or whatever the case is) The employee must comply and especially where this is a Company Policy. The employer is entitled to stipulate when annual leave may or must be taken. The employers authority for this is section 20 (10) (a) and (b) of the BCEA.

Very briefly, if there is no agreement to the contrary between employee and employer, then annual leave must be taken at a time determined by the employer. Note that the Act states clearly “ Annual leave must be taken ……..(inter alia) ……. At a time determined by the employer…….” Provided that no other agreement on this exists between employer and employee.

So don’t enter into any agreements with employees regarding when annual leave may be taken. Apply your right in terms of section 20 (10) (b) that gives you, the employer, the right to stipulate when leave may be taken.

In this way, you can insist that any employees who still have leave due and is approaching the end of the stipulated period in which leave may be taken in terms of your Annual Leave Policy, that they must take the leave whether it suits them or not to do so.

To read the original article (part 1) kindly follow the link www.labourguide.co.za/leave.htm