Annual leave is a short term for the leave days specified in the Labor Code of Vietnam. This is one of the important benefits of employees besides receiving salaries, bonuses, holidays, Tet, etc. So in case the employee has not finished his annual leave, can it be converted into money?
Article table of contents
Current regulations:
According to the Labor Code 2012 of Vietnam, an employee who has been working for an employer for full 12 months is entitled a fully paid annual leave as stated in his/her labor contract as follows:
- 12 working days for an employee working in normal conditions;
- 14 working days for an employee doing a heavy, hazardous or dangerous job; or an employee working in a place with harsh living conditions on the list issued by the Ministry of Labor, War Invalids and Social Affairs in coordination with the Ministry of Health, or for minor or disabled employees;
- 16 working days for an employee doing an extremely heavy, hazardous or dangerous job; an employee working in a place with extremely harsh living conditions on the list issued by the Ministry of Labor, War Invalids and Social Affairs in coordination with the Ministry of Health.
Concurrently, according Article 114 of the Labor Code 2012 of Vietnam, payment for untaken leave days are specified as follows:
1. An employee who, due to employment termination, job loss or for other reasons, has not taken or fully not taken annual leave is entitled to a cash payment for the untaken leave days.
2. An employee who has worked for under 12 months may have annual leave days in proportion to the time of working. In case of not taking leave, he/she is entitled to a cash payment for these untaken leave days.
According to the spirit of the Labor Code 2012 of Vietnam, employees who have not finished their annual leave will be paid in cash for the untaken leave days, even if the employee has worked for less than 12 months. The reason for not taking leave can be due to job termination, loss of job or other reasons.
From January 01, 2021:
According to Clause 3 Article 113 of the Labor Code 2019 of Vietnam:
3. An employee who, due to employment termination or job loss, has not taken or not entirely taken up his/her annual leave shall be paid in compensation for the untaken leave days.
It can be seen that, from 2021, only when the employee loses his/her job due to termination of work or loses his/her job but has not taken all annual leave days, the employer will pay wages for the days that have not yet been taken. The Labor Code 2019 of Vietnam has dropped the case "for other reasons" when the annual leave has not been taken, thus, in case the employee is still working at the enterprise but has not taken the full annual leave of the previous year, the employer will not be paid wages for those untaken days.
Guiding this provision, according to Clause 3 Article 67 of the Decree No. 145/2020/NĐ-CP of Vietnam’s Government, the salary as the basis for paying an employee for untaken annual leave days is the salary written in his/her employment contract of the month preceding the month in which the employee resigns or loses his/her job.
Somes notes on annual leave of employees:
- When taking annual leave, an employee shall receive an advance payment of at least salary for the entitled days of leave. (Clause 5 Article 113; Clause 3 Article 101 of the Labor Code 2019 of Vietnam)
- When taking annual leave, should the employee travel by road, rail, water and the travel days, the traveling time in excess to 02 days will be added to the annual leave days, and this policy shall only be granted once for an annual leave in a year.
- Annual leave will increase according to working seniority, for every full 05 years working for an employer, the number of annual leave days of employees will be increased by 01 day respectively.
Thuy Tram
- Key word:
- Labor Code 2019 of Vietnam
