Year-end shutdowns and annual leave

Can a business require leave over the shutdown?

Under section 20 of the Basic Conditions of Employment Act, annual leave is taken at a time agreed between employer and employee or, without an agreement, at a time the employer decides. Many businesses use this to close over the year end and have the closed days come off annual leave. Set it out in your leave policy or contracts, and tell people well in advance.

Count working days only

Only days the employee would normally work come off their leave. Weekends do not, and neither do public holidays. Under the Public Holidays Act, a public holiday that falls on a Sunday moves to the Monday; one that falls on a Saturday does not move.

For a closure from Thursday 24 December 2026 to Friday 1 January 2027, on a five-day week:

Date	Day	Counts as leave
24 Dec	Thursday	Yes
25 Dec	Friday, Christmas Day	No, public holiday
26 Dec	Saturday, Day of Goodwill	No, weekend
28 to 31 Dec	Monday to Thursday	Yes, 4 days
1 Jan	Friday, New Year's Day	No, public holiday

That closure costs each employee 5 days of annual leave.

Two leave years

A closure that runs into January may cross from one leave year into the next for employees whose leave year follows the calendar year. The December days come from this year's leave and the January days from next year's. Employees whose leave year starts on their own start date may have the whole closure in one year.

People without enough leave

New starters, and anyone who has used most of their leave, may not have enough days for the closure. The usual options are to let them take the days as leave in advance, to treat the shortfall as unpaid leave, or to agree on something else. Whatever you choose, agree it with the people concerned and write it into your policy; this is a point to take advice on.

People already on leave

Someone who already booked leave on some of the closure days should not lose those days twice. Count only the closure days they had not already booked.

How AwayDesk handles it

In Settings, Company closures, you enter the dates, the leave type, and everyone or the departments that close. AwayDesk works out each person's working days, skips public holidays and days already booked, splits the closure at the end of each person's leave year, and shows who would go below zero before anything is saved. Undo puts every day back.

General information, not legal advice. Sources: Basic Conditions of Employment Act 75 of 1997, section 20; Public Holidays Act 36 of 1994, section 2. Check the Acts and your contracts, or ask a labour adviser.