COVID-19: CAN SOUTH AFRICAN EMPLOYERS AND EMPLOYEES AGREE TO POSTPONE THE FORFEITURE OF ANNUAL LEAVE?

The regulations dealing with the conditions and restrictions for Alert Level 4 (AL4 Regulations) were published on 29 April 2020.

What is clear from the AL4 Regulations, and for the foreseeable future, is that restrictions remain imposed on the movement of people especially those who do not qualify as ‘permitted’ or ‘essential’ services workers.

These restrictions on movement and travel may affect employees’ desire to take their annual leave during the national state of disaster. Depending on the agreement regulating leave, employees may forfeit accrued but not taken leave in these circumstances.

Many employers take the ‘use it’ or ‘lose it’ approach, but may want to reconsider and vary the terms relating to the forfeiture of leave, if they are in a position to do so. This newsflash addresses whether employers and employees can agree to postpone the forfeiture of annual leave in these circumstances.

Ordinarily, many employers in accordance with the Basic Conditions of Employment Act require employees to take annual leave not later than six months after the end of the annual leave cycle.

Where the annual leave cycle runs from January to December each year, the employee’s annual leave entitlement in respect of that annual leave cycle would lapse by 30 June of the following year. Many employment contracts accordingly contemplate the forfeiture of annual leave after 30 June each year. 

In the case where employees have taken their annual leave during the national state of disaster, the issue of forfeiture is unlikely to arise. Employers are at liberty, in the absence of an agreement to the contrary, to require employees (even those working as AL4 permitted or essential workers) to take annual leave at a time convenient to the company, including during the national state of disaster.

However, where employees have not taken their annual leave, they may now be faced with the possibility of forfeiting their annual leave because it is due to expire on 30 June 2020.

In order to prevent this from happening, the employer can (but is not required to) agree with employees to change the date of forfeiture in respect of the current annual leave cycle only and for a limited period. This should not present any issues from employees as this amendment to their terms and conditions of employment would be in their interest and for their benefit.