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Annual Leave

Part IV of the Employment Act & Section 33 applies only to:

  • Workmen earning not more than $4,500 basic monthly salaries; and
  • Other employees (other than workmen) covered under Employment Act earning not more than $2,500 basic monthly salaries (Note: basic salary excludes overtime, bonus, Annual Wage Supplement, productivity incentive payment, reimbursement for special expenses and any allowances).

Note: Part IV of the Employment Act does not cover managers or executives.


An employee is entitled to Annual Leave if they meet the following conditions:

  • He/she is covered under Part IV of the Employment Act
  • He/she has worked for at least three months

An employee's annual leave entitlement under Part IV of the Employment Act is as follows:

Year of service Days of leave
1st 7
2nd 8
3rd 9
4th 10
5th 11
6th 12
7th 13
8th and thereafter 14

Where an employee's year of service begins from the day he/she started work with the employer.

The employer may grant the employee unpaid leave, if the employee is not eligible for annual leave or has used up his annual leave.

The employer can deduct an employee's salary for excess annual leave taken.  i.e. excess annual leave may be treated as unpaid leave and deductions made from salary accordingly.

If an employee has worked less than a year

An employee's annual leave entitlement should be in proportion to the number of completed months of service in that year (If the employee has been in service for at least three months). This entitlement also applies to an employee who has not been confirmed.

If an employee has worked for less than one whole year (i.e. less than 12 months), his/her annual leave should be pro-rated using the following formula:

(No of months in service/12) x 7

If the fraction of a day is less than one-half, it shall be disregarded but if the fraction is half or more, it shall be regarded as one day.

Periods of no pay leave should not be included when computing annual leave entitlement.

Full vs half day’s leave

Annual leave can only be taken on working days. Any leave taken by an employee on a working day, be it a full or half working day (e.g. on Saturday), is considered a full day's leave. However, an employer has the option to treat leave on a half working day as a half day of annual leave.

Forfeiture of annual leave

An employee's annual leave entitlement can be forfeited if the employee:

  1. Absents him/herself from work without permission or reasonable excuse for more than 20% of the working days in a month or year, as the case may be;
  2. Fails to take his/her leave within 12 months after the end of 12 months of continuous service; or
  3. Is dismissed on the grounds of misconduct.

Instead of forfeiting leave the employer may, at his/her discretion, encash the leave at the gross rate of pay based on the employee's last drawn salary.

If the termination of an employee's service is not on account of misconduct, the employer must pay him/her for every day of leave not taken, at the gross rate of pay based on the employee's last drawn salary.

Marriage and compassionate leave entitlement

There is no statutory entitlement for marriage and compassionate leave. The entitlement to such leave depends on what is in the employment contract or agreed mutually between employer and employee. If no such provisions had been agreed, employees could apply for annual leave or unpaid leave for such purposes.

Last updated on 31 March 2014 11:41:18