What Is Annual Leave? How Is It Calculated?

Annual leave is one of the most fundamental rights of every employee in Turkey, guaranteed by the Labor Law No. 4857. Designed to protect employees' physical and mental well-being, maintain work-life balance, and boost productivity, the right to paid annual leave is a critical topic that both employers and employees must understand correctly. In this guide, we cover the legal framework of annual leave entitlements, calculation methods, leave durations based on seniority, and unused leave rights in detail.

What Is the Right to Annual Leave and Who Is Eligible?

Paid annual leave refers to the legally mandated rest period during which an employee who has worked at a workplace for a specified duration continues to receive their salary without performing any work. Under Article 53 of the Labor Law No. 4857, every employee who has worked for at least one year from their start date, including the probationary period, is entitled to paid annual leave.

To be eligible for annual leave, the following conditions must be met:

• The employee must have worked for the same employer for at least one year.
• The probationary period is included when calculating the length of service.
• Seasonal or campaign workers are not eligible for annual leave under Article 53 of the Labor Law.
• Part-time employees are entitled to annual leave under the same conditions as full-time employees.

It is important to note that paid annual leave is a constitutional right that employees cannot waive and employers cannot refuse to grant.

How Are Annual Leave Durations Determined Under the Labor Law?

Article 53 of the Labor Law No. 4857 clearly defines the annual leave days employees are entitled to based on their length of service. The minimum annual leave durations by seniority are as follows:

These are minimum durations; employers may increase them through individual or collective labor agreements but cannot reduce them under any circumstances.

Special Cases and Exceptions

• For employees under 18 and over 50, the minimum annual leave is at least 20 days, regardless of their length of service.
• For workers employed in underground operations (mining, tunneling, etc.), the leave durations listed above are increased by 4 days each.
• National holidays, public holidays, and weekly rest days that fall within the annual leave period are not counted as part of the leave, effectively extending the actual leave duration.

How Is Annual Leave Calculated?

Annual leave calculation begins from the employee's start date, and leave entitlement accrues for each full year of service. The key points to consider when making the calculation are:

Calculating Length of Service

Length of service covers the period an employee has actually worked under the same employer. The following periods are also included in the calculation:

• Periods when the employee was unable to work due to illness, accident, or statutory leave
• Maternity leave periods for female employees (before and after childbirth)
• Periods of military call-up other than compulsory military service
• Strike and lockout periods (within legal timeframes)

Practical Calculation Example

Let's assume an employee started work on March 1, 2020:

• March 1, 2021: First annual leave entitlement accrues — 14 days
• March 1, 2025: 5th year is completed, leave increases to — 20 days
• March 1, 2035: 15th year is completed, leave increases to — 26 days

Leave earned each year becomes available for use once that year is completed. The employer may determine the timing of leave usage taking business operations into account, but has no right to withhold leave entirely.

How Is Annual Leave Pay Calculated?

Under Article 57 of the Labor Law, employees are paid based on their last gross salary before the leave period begins. Irregular payments such as overtime, bonuses, and premiums are not included; only the base salary is considered.

The annual leave pay calculation is based on the following formula:

Daily gross salary = Monthly gross salary / 30

Annual leave pay = Daily gross salary x Number of leave days

For example, for an employee with a monthly gross salary of 30,000 TL who takes 14 days of annual leave:

• Daily gross salary: 30,000 / 30 = 1,000 TL
• Annual leave pay: 1,000 x 14 = 14,000 TL (gross)

This amount is paid to the employee in advance, and the employee is prohibited from working for pay elsewhere during the leave period.

What Happens to Unused Annual Leave?

This is one of the most common questions among employees and an area that employers must pay close attention to. According to the Labor Law, unused annual leave absolutely does not expire.

While the Employment Relationship Continues

Unused annual leave continues to accumulate. The employer is obligated to plan accordingly and ensure that employees use their leave entitlements. Even if an employee does not wish to take leave, the employer can direct leave usage with business operations in mind.

When the Employment Relationship Ends

Upon separation from employment (resignation, termination, retirement, etc.), all unused annual leave is calculated based on the employee's final salary and paid in a lump sum. This payment is known as leave pay receivable, and the statute of limitations is 5 years from the date the employment contract ends.

Employee Rights When Leave Is Not Granted

If the employer fails to grant annual leave without a valid reason, the employee has two fundamental rights:

1. The employee may terminate the employment contract for just cause under Article 24 of the Labor Law and become entitled to severance pay.
2. Upon leaving, the employee may claim payment for all accumulated unused annual leave.

What Are the Rules to Follow When Using Annual Leave?

Articles 53 through 60 of the Labor Law contain important provisions regarding the use of annual leave:

• Annual leave may be split into a maximum of three parts by mutual agreement. In this case, one of the parts must be at least 10 days.
• When determining annual leave dates, the employer must consider the employee's preferences and consult the leave committee.
• Saturdays and Sundays during leave are counted as part of the leave period (excluding the weekly rest day).
• The employer cannot effectively block an employee's leave entitlement by splitting or deferring it.
• The employer is required to maintain a leave schedule to manage annual leave usage.

Why Is Expense Management Important During Annual Leave Periods?

Annual leave periods are the times when companies are most vulnerable to disruptions in their operational processes. Expense management and spending tracking, in particular, can slow down significantly during leave periods. Manual expense reporting processes can cause approval bottlenecks and delays in financial reporting when key personnel are on leave.

This is exactly where Masraff comes in. With Masraff's artificial intelligence-powered expense management platform:

• Employees can upload expense receipts to the system in seconds via the mobile app, even during leave periods.
• Automated approval mechanisms ensure expense approval processes continue uninterrupted without managers needing to be physically in the office.
• Artificial intelligence technology automatically reads and categorizes data from expense invoices.
• Thanks to ERP integrations, expense data is transferred to accounting systems in real time.

Tracking leave allowances, travel expenses, and other leave-related costs during vacation periods can also be easily managed with Masraff.

Frequently Asked Questions (FAQ)

When does the right to annual leave begin?

The right to annual leave accrues after an employee has worked for the same employer for at least one year, including the probationary period. Once the first full year of service is completed, the employee becomes entitled to use their annual leave according to their seniority.

Does annual leave include weekends?

Yes, Saturdays are included in the annual leave period. However, Sundays (weekly rest day), national holidays, and public holidays are not counted as part of the annual leave period. Therefore, these days fall outside the leave duration, effectively extending the actual leave period.

Do unused annual leave days expire?

No, unused annual leave absolutely does not expire. It continues to accumulate, and if the employment contract ends for any reason, it is calculated based on the employee's final salary and paid in a lump sum. The statute of limitations for this claim is 5 years.

Can the employer unilaterally determine annual leave dates?

The employer may determine the timing of annual leave taking into account business operations and the employee's preferences. However, the employer cannot continuously defer leave in a way that prevents the employee from using their full entitlement. Failure to grant leave gives the employee the right to terminate their contract for just cause.

Do part-time employees have the right to annual leave?

Yes, part-time employees are entitled to paid annual leave under the same conditions as full-time employees. Working shorter hours does not eliminate or reduce the right to annual leave.

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