Annual Leave in South Africa: The BCEA Rules

This guide covers sections 20 and 21 of the BCEA, and section 40 on payment when employment ends. It also explains why annual leave is kept out of absenteeism measures. For the other statutory leave types, see our guides to sick leave and family responsibility leave.

Who gets annual leave under the BCEA?

• The leave chapter applies to all employees covered by the BCEA except those who work less than 24 hours a month for the employer (BCEA s19(1)).
• The earnings threshold under s6(3) only excludes higher earners from parts of Chapter Two (working hours and overtime). Senior managers and high earners still get BCEA annual leave.
• Leave above the BCEA minimum is governed by the contract or policy, unless an agreement says otherwise (BCEA s19(2)).

How many days of annual leave do you get in South Africa?

The employer must grant at least "21 consecutive days' annual leave on full remuneration in respect of each annual leave cycle" (BCEA s20(2)(a)). Twenty-one consecutive days is three calendar weeks, so the number of working days depends on the working week:

The Department of Employment and Labour summarises the same rule (DEL basic guide to annual leave). The employee is entitled to take the leave on consecutive days (s20(3)).

Accrual by days or hours worked

By agreement, leave can instead accrue at (BCEA s20(2)(b) and (c)):

• one day of annual leave on full remuneration for every 17 days on which the employee worked or was entitled to be paid; or
• one hour of annual leave on full remuneration for every 17 hours on which the employee worked or was entitled to be paid.

"Entitled to be paid" means paid days off, such as paid leave and public holidays, also count. For a full-time employee on a five-day week, about 260 paid days a year divided by 17 gives roughly 15 days, the same as the 21-consecutive-day rule. The hourly method is useful for part-time and shift employees whose hours vary.

What is the annual leave cycle?

The annual leave cycle is the 12 months of employment with the same employer that start when the employee starts work, or when the previous cycle ends (BCEA s20(1)). Each employee's cycle therefore follows their own start date. Many employers run leave on a calendar or financial year instead. That works if no employee ends up with less leave, or later access to leave, than the BCEA cycle would give.

When must annual leave be granted?

• Within six months. The employer must grant annual leave not later than six months after the end of the annual leave cycle (BCEA s20(4)).
• Timing. Leave is taken as agreed between employer and employee or, if there is no agreement, at a time the employer determines in line with s20 (s20(10)). An employer can therefore schedule leave, for example during a year-end shutdown.
• Not during other leave or notice. An employer may not require or permit an employee to take annual leave during any other period of leave under the leave chapter, or during a notice period (s20(5)). The exception: the employer must allow annual leave during a period of unpaid leave if the employee asks in writing (s20(6)).
• No work on leave. An employer may not require or permit an employee to work for it during annual leave (s20(9)).
• Occasional leave. If the employer grants occasional paid leave at the employee's request, it may deduct those days from the annual leave entitlement for that cycle (s20(7)).

Can unused annual leave be forfeited?

The BCEA does not answer this directly. What the Act says:

• The employer must grant annual leave within six months after the cycle ends (s20(4)).
• The employer may not pay an employee instead of granting leave, except on termination of employment (s20(11)).
• On termination, the employer must pay for "any period of annual leave due in terms of section 20(2) that the employee has not taken" (s40(b)).

The Act does not say what happens to statutory leave that is still untaken after the six-month period. Two views are common:

1. Forfeiture applies where the employer offered or allowed the leave and the employee chose not to take it within the period. Many leave policies say this.
2. No forfeiture where the employer did not grant the leave in time, for example because it refused leave requests or the workload made leave impossible. On this view, the employer has failed in its duty under s20(4) and the employee keeps the days, to be taken later or paid out on termination.

We could not confirm a Labour Appeal Court or higher court ruling that settles the point, so treat it as unsettled. Leave above the BCEA minimum is different: the contract or policy can set forfeiture rules for those extra days (s19(2)).

If you rely on forfeiture, reduce the risk:

• Put the rule in a written policy that employees have seen.
• Remind employees in writing of their balance and the deadline before it passes.
• Do not refuse leave requests and then forfeit the same days.
• Keep records of leave offered, requested and refused.

How is annual leave pay calculated?

The employer must pay leave pay at least equal to the remuneration the employee would have received for working for a period equal to the leave, calculated at the employee's rate of remuneration immediately before the leave and in accordance with section 35 (BCEA s21(1)). Leave pay must be paid before the leave starts or, by agreement, on the usual pay day (s21(2)).

• Remuneration, not just the wage. Sick leave and family responsibility leave are paid at the "wage", which is the money paid for ordinary hours (BCEA s1). Annual leave is paid on "remuneration", which the Act defines as any payment in money or in kind for working (s1). It is wider than the wage.
• Which payments count. Section 35(5) lets the Minister determine which categories of payment form part of remuneration. Check the current determination when pay includes allowances, employer contributions or payments in kind.
• Commission and variable pay. If remuneration is calculated wholly or partly on a basis other than time, or fluctuates significantly, payments under the BCEA are calculated on the average over the preceding 13 weeks, or the period of employment if shorter (s35(4)).

Is annual leave paid out on resignation or dismissal?

Yes. Payment instead of leave is only allowed on termination (s20(11)). Section 40 requires the employer to pay (BCEA s40):

• Leave due from completed cycles that the employee has not taken, calculated under s21(1) (s40(b)).
• Pro rata leave for the incomplete cycle, if the employee has been employed for longer than four months: one day's remuneration for every 17 days worked or entitled to be paid, or a basis at least as favourable (s40(c)).

Example: an employee on a five-day week resigns about seven months into a cycle, after roughly 150 days worked or paid. That gives about 8.8 days for the incomplete cycle (150 divided by 17). If the employee took 3 days of annual leave earlier in that cycle, those days are normally deducted, leaving about 5.8 days to pay out.

Unused sick leave and family responsibility leave are not paid out on termination under the BCEA.

Public holidays during annual leave

If a public holiday falls on a day during annual leave on which the employee would ordinarily have worked, the employer must grant an additional day of paid leave (BCEA s20(8)). In practice, the public holiday is not deducted from the leave balance.

Sick during annual leave

An employer may not require or permit an employee to take annual leave during any other period of leave the employee is entitled to under the leave chapter (BCEA s20(5)(a)). This is generally read to mean that if an employee falls ill during annual leave, the days of illness are sick leave and the annual leave days are restored, provided sick leave is available. The employee should tell the employer at the time, and the usual certificate rules apply. See our guides to sick leave in South Africa and medical certificate requirements.

Annual leave and absenteeism: planned versus unplanned leave

Absenteeism measures are about unplanned absence: days an employee was expected at work and did not come. Sick leave is the main part of it. Annual leave is planned and approved in advance, and it is a statutory right. It is therefore excluded from absenteeism rate calculations. Counting it would make employees who take their legal leave look like absence problems, and would hide real changes in unplanned absence. Our absenteeism rate calculator uses this definition, and our article on South African absenteeism benchmarks explains why the definition matters when comparing figures.

Annual leave still matters for absence management in two ways:

• Sick days next to annual leave. A sick day immediately before or after annual leave, or after a leave request was refused, can be worth a conversation. It is not proof of misuse.
• Leave not taken. Employees who carry large balances and rarely take leave are not getting the rest the BCEA intends. That is a planning issue for managers.

Appsentia keeps annual leave out of the absenteeism rate and the cost of absence, which are calculated from sick leave only. It uses other leave types to flag sick days taken next to other leave, alongside sick days on Mondays and Fridays and around public holidays and paydays. See what Appsentia analyses, and our overview of South African labour law and absenteeism for how absence is handled under the BCEA and the LRA.

Sources

1. Basic Conditions of Employment Act 75 of 1997 (as amended), gov.za: sections 1, 6, 19, 20, 21, 35 and 40.
2. Department of Employment and Labour, Basic guide to annual leave.

This page is general information, not legal advice. Check the current Act, and any sectoral determination or bargaining council agreement that covers your employees, before acting. A bargaining council collective agreement can change annual leave terms, but may not reduce annual leave to less than two weeks (BCEA s49(1)(c)).