After the bonus payout season, what normally follows is the resignation season. Many have asked if they can use their annual leave to offset their last working day upon tendering resignation.
👉 First, the annual leave should be pro-rated until the last day of service. For example. if you tendered on 14th of March and your notice period is one month, then your leave should be pro-rated until 13th of April.
👉 Technically, when you utilise your annual leave to offset your last physical working day, you are actually on annual leave on those final days. So, like any leave application, this requires approval.
👉 However, if the company rejects the offset with the last working day, then the balance of the annual leave should be encashed.
👉 The formula to calculate leave encashment is fixed, as stated in the Employment Act 1955 Section 60I(1A), which is the monthly rate of pay / 26 or weekly rate of pay / 6. The company can pay more if they wish, but not less.
My advice will always be to have a conversation with your boss and agree on a mutually acceptable last working day. You started the job on a positive note, and you should leave it nicely too, regardless of what happened in between. Don’t burn bridges.
Happy weekend, everybody! All the best with your negotiations and offboarding!
#AnnualLeave #WorkforceHarmony #AuntyHR
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