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Annual Leave

Part IV of the Employment Act & Section 35 applies only to:

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


An employee is entitled to Annual Leave if he or she satisfies all the following conditions:

  • He or she is covered under Part IV of the Employment Act (see above); and
  • He or she has served the employer 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

* An employee's year of service starts from the day he or she begins work with the employer.


If the employee begins work on 14 Mar 2013, the annual leave entitlement will be computed as follows:

14 Mar 2013 to 13 Mar 2014 (12 complete months of service) - 7 days (1st year)
14 Mar 2014 to 13 Mar 2015 (12 complete months of service) - 8 days (2nd year)
14 Mar 2015 to 13 Mar 2016 (12 complete months of service) - 9 days (3rd year)

If at the time of his leave application, an employee is not entitled to paid annual leave or has used up his paid annual leave, he may apply for no-pay leave instead.

An employer can deduct an employee's salary for paid annual leave taken beyond his entitlement. As such, an employer is advised to keep a record of an employee's leave application (whether paid or unpaid).

If an employee has completed less than 12 months of service

An employee, who has been in service for at least three months, shall be entitled to pro-rated leave based on the number of completed months of service. This entitlement applies to an employee even if he or she is still on probation.

The annual leave is pro-rated as follows:

(No. of completed months of service ÷ 12 months) X No. of days of annual leave entitlement


The completed months of service of an employee who started work on 14 Mar 2014 and left service on 31 Jul 2014 is computed as follows:

14 Mar 2014 to 13 Jul 2014 = 4 completed months.

The period from 14 Jul 2014 to 31 Jul 2014 would be disregarded as it is not a completed month.

In calculating annual leave entitlement, 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.


For an employee who has completed 4 months' of service and entitled to 10 days' leave a year:

(4 completed months ÷ 12 months) X 10 days leave entitlement = 3.33 days (rounded down to 3 days as the fraction is less than 0.5)

Periods of approved no-pay leave is not included when computing annual leave entitlement.

One day's leave or half-day's leave

Annual leave is only be taken on working days. Any leave taken by an employee whether on a full working day or half working day, is considered as one day's leave even if he or she is required to work on half a day on that day (e.g. an employee who works on Saturday from 9am to 1pm).

However, an employer may choose to treat leave on a half working day as half day's leave instead of one day.

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, an employer may exercise discretion and encash the unconsumed 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 the employee for every day of unconsumed leave. The payment is based 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 22 January 2015 02:29:10