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HR 101 – What to do When . . . Staff Have Accumulated Leave

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Please note that this pertains to South African Labour Relations and Best Practice.

This can be a real nasty! Clearly, it is in your own best interests to have the correct wording for what you want, in your letter of appointment.

The Basic Conditions of Employment Act says that the staff member is entitled to a minimum of 15 working days leave per annum. It also states that the staff member cannot ‘sell’ you their leave.

Here’s the problem – there’s nothing in there to stop staff members from accumulating leave and this is where you will ultimately have a problem, one way or another.

Obviously, prevention is better than cure, so let’s put down here some of the things that you should have in your letter of appointment:

Let’s break down the 15 days per year as per the Basic Conditions of Employment Act requirement. Now if your company closes over the December holiday period, your staff will only accumulate 3 maybe 4 days per annum, which means that they should still take those days during the course of the year. I would suggest that you have a clause that says something along the lines of – leave cannot be accumulated. At least 80% of the leave must be taken within the course of the year, the balance of 20% must be taken by no later than 31st March of the following year. Leave accumulated and not taken at this time will be forfeited and lost. Remember though that if the employee resigns or is dismissed, the leave that has not been taken (unless it was forfeited and lost) has to be paid out at this time.

If your company closes down in December, but the staff member wants their full leave during the course of the year. Your letter of appointment should state clearly that taking leave during the closure of the Company is mandatory and that any leave not taken at that time must be taken during the course of the year. Staff will only be granted leave at a time that is convenient to the Company. There is nothing in the Basic Conditions of Employment Act that states that staff can take leave as and when they feel like it, it has to be at a time that is convenient to the Company.

Then, of course, you will have the odd members of staff who will phone you on a Monday morning and say “Oh, by the way, I’m not coming in today because I am taking leave.” Not nice! So in your letter of appointment, you should state that – leave must be applied for at least a week or month (whatever is convenient to you as the employer) prior to leave being taken. This will give you a chance to put measures in place to accommodate being short-staffed. If the nature of your business means that everyone is under extreme pressure during certain times of the month this can also be factored into the Letter of Appointment along the lines of – Leave will not be granted during the period between the last weekend of a month and the first weekend of the following month.

If you follow these simple guidelines, the only time you will have a problem is if a staff member has applied for leave and you as the employer has denied them that leave for whatever reason. If the employee then resigns or you dismiss them, you will have to pay them out. Don’t do that and believe me you will be paying out – big time. Remember that leave that is paid out when a staff member leaves, is paid out at their current rate of pay, not the rate of pay that they were on when the leave was originally supposed to be taken, but the current rate of pay.