Answer:
1. The enterprise may stipulate the extension of the use of the remaining annual leave days of the previous year to the beginning of the following year in case the Employee does not take all of annual leave, and the remaining annual leave days which have still been not used after the extension period will be automatically lost. In this case, may the Employee be entitled to the payment for the unused annual leave?
According to the Labour Code, If an Employee loses his or her job or is retrenched and has not taken all of his or her annual leave, such Employee is entitled to payment of wages for the days for which leave has not yet been taken. In addition to the above two reasons, for any other reason, the Employer does not need to pay wages for the annual leave that the Employee has not taken leave or not yet taken off.
In practice, some enterprises often stipulate to extend the use of the remaining annual leave days to the end of the first quarter of the following year and the remaining annual leave day which is unused will automatically be lost after the expiration of the extended period. It is also legitimate if the Employer does not pay salary for the annual leave days that the the Employee has not taken. This provision should also be clearly expressed by the enterprise in their IRL and CLA so as to have more basis for the application of this regulation in practice.
2. In the peak months of the year or cases of unexpected emergency, may the enterprise regulate that the Employee is not allowed to take annual leave during those times to prevent adverse effects to the business operations?
The Employee who has worked a full 12 months for the Employer is entitled to annual leave on full pay pursuant to the LC[1]. In addition, the Employee who has not worked a full 12 months yet for the Employer is entitled to annual leave at the ratio corresponding to the number of months for which they worked[2]. Hence, annual leave is considered to be the right of the Employee according to the labour law and the regulation of the Employer to limit the annual leave of the Employee during peak months or in emergency cases is not in accordance with the provisions of the labour law.
On the other hand, the Labour Code also allows the Employer to promulgate the annual leave schedule after consulting with and notify in advance to the Employee[3]. Therefore, in order to ensure business operations of the enterprise during the peak months, the Employer may still reach an agreement with Employee on the annual leave schedule to avoid taking the leave during those peak months.
[1] Article 131.1 of the Labour Code
[2] Article 131.2 of the Labour Code
[3] Article 113.4 of the Labour Code
