Working and Business > Annual Paid Leave

Annual Paid Leave, Employer Responsibility


Annual Paid Leave, Employe...

Employer measures to promote the use of Annual Paid Leave.            
(Article of 59-2 of the LSA)

1. Within the first 10 days of the three months before unused leave is forfeited, the employer shall notify each worker of the number of his/her unused leave days and urge them in writing to decide when they would prefer to claim the leave and to inform the employer of the decided leave period; and 
2. Notwithstanding the notification prescribed in Subparagraph (1), if a worker fails to decide when to use the whole or part of the unused leaves, the employer shall decide for the worker when to use the unused leave and notify the worker of the decided leave period in writing no later than 2 months before the unused leave is forfeited.

Payment and scope of (unused) Annual Paid Leave allowance.

1. Annual Paid Leave allowance 
 When the employee uses Annual Paid Leave, the employer shall grant paid leave with ordinary wages or average wages during the period of leave in accordance with employment rules or other regulations.  (Article 59 (5) of the LSA).

2.  Unused Annual Paid Leave allowance 
The right to request unused Annual Paid Leave allowance occurs on the day after the right to request Annual Paid Leave expires, if the employee provided labor without using Annual Paid Leave accruing as remuneration for work for the previous year.  In this case, the employer shall grant ordinary wages or average wages for the unused leave days of Annual Paid Leave during the previous year in accordance with employment rules or other regulations.
It cannot be seen as a violation of the Labor Standards Act when the company in the Rules of Employment regulates that unused Annual Paid Leave allowance is paid on the first payment day since the right to request Annual Paid Leave expires. 
 
In the case of an employee who retires, the right to request Annual Paid Leave occurs in the retired year (e.g., in 2006) according to the attendance rate of the year before the retired year (e.g., in 2005) and expires because of termination of the employment.  In this case, the employer shall pay ordinary wages or average wages stipulated by the employment rules or other regulations for the unused days of Annual Paid Leave within 14 days of retirement, even though there is no period left to use Annual Paid Leave. 

Calculation of Annual Paid Leave
Annual Paid Leave shall be calculated from the starting day of actual labor service, such as the employment date, in principle, but can be provided in a collective manner during the fiscal year in order to promote convenience in labor management according to the Rules of Employment or the Collective Bargaining Agreement.  In this case, the right to request unused Annual Paid Leave allowance occurs on the first day of the year after the current year available to use Annual Paid Leave.  

Whether to include Annual Paid Leave allowance into average wages to calculate severance pay
1. Unused Annual Paid Leave allowance already occurred before retirement
By the criteria of the attendance rate during the year prior to the retired year, 3/12 of the unused Annual Paid Leave allowance among Annual Paid Leave occurring the year prior to the retired year shall be included into “the basic wage items to calculate average wage for severance pay”.
 2. Unused Annual Paid Leave allowance occurred just because of retirement
The unused Annual Paid Leave allowance that the employee is granted just because of retirement in the retired year according to the attendance rate of the year before the retired year shall not be included into “the basic wage items to calculate average wage for severance pay”, because the unused Annual Paid Leave allowance is not wages paid during the calculation of the average wage.

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Last Updated on 2014-09-17


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