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Unpaid Leave Clarification

Mon, 24 Aug 2009 06:18:18 PM  (Last updated: Wed, 26 Aug 2009 10:58:55 AM)

Good day,

I have staffs that has already used up their MC's for this year and becoz of that, the company is deducting their annual leave instead.upon deduction of the annual leave, they claim that it is unfair treatment as they say that its legitimate MC's given and shouldnt be deducted from their annual leave. Hospitalization leave cannot be allowed for this MC's as there are not being hospitalized. As such, staff can only be advised to take unpaid leave if necessary.


1) Does the company have the right to approve and reject this said Unpaid leave?

2) Company can deduct this unpaid leave legally from their monthly salary?

3) Is unpaid leave covered in any other sections of the employment act?

4) If the MC's are issued based on depression and the doctor cannot guarantee the recovery period, how shall the leave be considered?

5) Unpaid leave will only affect the staff's year end performance?

Would really need some clarification / feedback on the above matter.

thank you.

KL Siew
Mon, 24 Aug 2009 06:55:45 PM


1. Company has the right to approve or reject applications for unpaid leave.

2. When the leave is unpaid leave, salary has to be deducted. Otherwise it cannot be termed as unpaid.

3. It is not covered. It is just no work means no pay.

4. Whether it is depression or any other illnesses, it is medical leave is the period as certified by the doctor to be unfit for work. The doctors must certify the date or a period  the employee is unfit for work.

5. To me, it will surely affect him in the year end appraisal, bonus payments, increments and so on.

Tue, 25 Aug 2009 01:11:57 PM

Good day Siew,

For point 4;

If the medical report from the doc cannot guarantee when the staff can recover, and the MC's have all been used up - can the company deduct the annual leave from the staff?

Can the company issue warning letter for the staff if they continous take unpaid leave?


Allee Lee
Tue, 25 Aug 2009 10:19:19 PM


we have staff taking approved unpaid leaves from 10/08/09 - 31/08/09.

1.Is it correct to say that for the month of August 2009, we should only pay the staff 5 working days i.e from 3/08/09 - 07/08/09 excluding saturday, sunday & Public holiday on 31/08/09.

2. How do calculate pay per day?

3. Under what section of the labour act,states that we use 26 days or 30days or 31 days to compute salary per day.

KL Siew
Wed, 26 Aug 2009 10:58:55 AM  (Last updated: Wed, 26 Aug 2009 11:32:19 AM)

Hi Mich

Regarding point 4, you are right and for those who habitually want take unpaid for all sorts of reasons, warning should be given to them. If they don't heed the warnings, disciplinary action should be taken against them.

To Alex Lee:

1. Shouldn't it be the other way round? Since it is unpaid leave,  wouldn't be that the whole period from 10/8 to 31/8 be no pay?Cross check this with the Labour Department.

2, Calculation will be (salary/31(for August)) x number of days of no pay leave. You better cross check this with the Labour Department.

3. There has been some confusion about the calculation of daily salary and unpaid leave and whether 26, 30, 31 and so on should be used. As as you said, where is the law concerning this. As I have always maintained, for calculation of salary, unpaid leave one should use the actual numbers of days in the month like January, March, May and so on you use 31, months like June, April etc you use 30, for February you use 28 or 29 for leap year. When a worker is monthly paid, he is paid everyday of the month including rest days, holidays and so on. So, by simply maths, his salary per day of the month  will surely behis salary/number of days of that month.

26 is use for the calculation of ORP(ordinary rate of pay) as mentioned in Section 60I of the Employment Act. Take a look at that Section 60I below. Notice the words "...For the purposes of this part."? What is "this part"? " This part means Part XII and what is Part XII about? It is about hours of work, rest days, holidays, annual leave, sick leave and (2) gives a formula and that's where the "26" appears.

60I. Interpretation.

(1) For the purposes of this part and Part IX:



(1A) Where an employee is employed on a monthly rate of pay, the ordinary rate of pay shall be calculated according to the following formula:

monthly rate of pay


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