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Annual leave according to the Labor law

According to the Labor Law, employees have several different rights. Therefore, rights guaranteed by law which the employee has are, for example, the right to salary, the right to compensation for transportation costs, the right to safety and protection of life and health at work (and, due to that, the right to compensation for injury due to injury at work), the right for paid leave and the like. Of course, the conditions under which each of these rights can be used are prescribed by the Labor Law.

In that sense, one of the basic rights of the employee is the right to annual leave, which will be analyzed below. Importance of this right is shown by the fact that the Labor Law does not allow to the employee to give up on it. In addition, it is not allowed to deny or replace this right with monetary compensation, except in the case of termination of employment contract in accordance with the Labor Law.

When does an employee acquire the right to annual leave?

The law explicitly stipulates that the employee acquires the right to use the annual leave in a calendar year after a month of uninterrupted, counting from the day of beginning of the employment relationship with the employer. As the employee has the rights and obligations from the employment relationship from the moment in which he starts to perform his working duties, the period of one month of uninterrupted work is calculated from that moment.

It is important to emphasize that period in which the employee was temporary prevented to work in the sense of regulations on health insurance and absence from work with salary compensation counts as a working period in the sense of above mentioned condition.

Example: If an employee started to work on, for example, May 15, the right to annual leave is acquired on June 15. However, imagine that an employee suffered an injury at work on May 20, and due to that he spent the next 10 days in the hospital. In that period of time he wasn’t able to work. According to Labor Law, in that situation, the employee will acquire the right to annual leave on June 15, all because his situation is, in fact, a temporary incapacity for work.

Annual leave labor law

How long the employee can be on the annual leave?

The duration of an annual leave is determined by the general act of the employer or the employment contract, for each calendar year. However, the law explicitly stipulates that annual leave cannot be shorter than 20 working days for each calendar year.

In that sense, the working week is counted as five working days, while holidays that are non-working days in accordance with the law, absence from work with salary compensation and temporary incapacity for work in accordance with health insurance regulations are not counting in above said sense.

Thus, if the employee was temporarily prevented to work in the sense of the regulations on health insurance, while he was on the annual leave, he has the right to continue to use the annual leave after the expiration of that incapacity for work.

How long the annual leave will last depends on the specific case, i.e. on the contribution at work, working conditions, work experience, professional qualifications of the employee and other criteria determined by the general act or the employment contract. Based on the stated criteria, the legal minimum of 20 days can be increased, but it does not have to. Therefore, the employer is obliged by law to provide the employee with annual leave for a minimum duration of 20 working days, while any longer duration of annual leave will depend on the circumstances of the specific case.

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Can annual leave be used in parts?

The Labor Law allows employees to use their annual leave in parts if they wish. In that sense, the employee is allowed to use the annual leave in two parts, by using the first part of it at least two working weeks continuously during the calendar year, and the rest by June 30 of the following year at the latest.

Annual leave use schedule

The employer decides when the annual leave will be used, depending on the needs of the job, all with the previous consultation with the employee.

The employer is obliged to deliver this decision the employee no later than 15 days before the day which is set as the beginning of the annual leave. If the annual leave is used at the request of the employee, the decision may be delivered by the employer to the employee right before the beginning of the annual leave.

The employer may deliver the said decision to the employee in electronic form, but, at the request of the employee, the employer is obliged to deliver the decision to him in written form as well.

However, in case of using the collective annual leave or annual leave in the certain organizational part of the employer, the employer can make a decision on annual leave in which he lists the employees and organizational parts in which they work and display it on the bulletin board at least 15 days before the day which is set as the beginning of the annual leave. After that, it is considered that the decision was delivered to the employees.

In that sense, it is important to emphasize that the Constitutional Court of the Republic of Serbia has taken the position that the employer makes the decision on the use of annual leave independently of the employee’s request. So, the employee is not obligated to submit request in order to use his right to annual leave.

If the needs of the job require that, the employer may change the time which has been set as time for the use of annual leave, but not later than five working days before the beginning of the annual leave.

However, the employee has the right to divide the annual leave into several parts and use it like that, but only if it has been agreed with the employer first.

What happens if the employee did not use the annual leave in the calendar year?

The law prescribes situations in which an employee, who has not fully or partially used the annual leave in a calendar year, has the right to use it until June 30 of the following year. This rule applies in the following situations (the reasons why the annual leave was not used):

  • absence from work in order to use maternity leave
  • absence from work for child care
  • absence from work for special child care

Proportional part of the annual leave

Situations in which employees will not work for a certain calendar year with a certain employer are easy to imagine. Therefore, an employee can be hired for a fixed working period of, for example, eight months, or, after five years and 2 months of working for the employer, they will agree on the termination of that employment contract. The employee is entitled to use his right to annual leave in these situations as well.

In that sense, the employee has right to a twelfth of the annual leave, i.e. a proportional part of annual leave for each month of work in the calendar year in which he started employment or in which his employment is terminated.

Example: Imagine that an employee has right to 24 working days of annual leave. The proportional part of that vacation on a monthly basis is 2 days (24 days / 12 months = 2 days per month). Therefore, if the employment relationship begins, for example, on May 10, 2018, and ends on February 10, 2020, in 2020, the employee can use 4 days based on his right to annual leave (2 months in the calendar year 2020 * 2 days).

What happens to the right to annual leave if the employment contract is terminated?

In case of the employment relationship termination, the employer is obliged to pay a monetary compensation to the employee who did not use the annual leave, fully or partially.

The amount of the stated compensation is determined by the amount of the average salary of the employee in the previous 12 months, all in proportion to the number of days of unused annual leave.

In addition, the Supreme Court of Cassation of Republic of Serbia took the position that the employee is also entitled to compensation for unused annual leave, if he did not use it because the employer did not consider his request for annual leave, which he submitted on time.

The Labor Law explicitly stipulates that the said compensation has the character of compensation for damages. However, the Ministry of Labor and Employment of Republic of Serbia has the opinion that the said compensation has the character of a salary, and the employer is obliged to calculate and pay taxes and contributions for compulsory social insurance on that basis.

In accordance with the practice of the courts, in addition to the right to the stated compensation, the employee is also entitled to seek the interest, which is calculated from the expiration of 30 days from the day of termination of the employment relationship, because the employer is obliged, in case of termination of employment relationship, to pay the employee all unpaid salaries, compensations and other benefits earned by the employee until the day of termination of employment relationship, so it is clear why the calculation of the interest starts from the expiration of that period.

For all further questions regarding to annual leave, or any other questions relating to labor and employment law, feel free to contact our law firm.

Date: 23.07.2020.

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