Forfeiture of leave benefits

In the recent judgment of Ludick v Rural Maintenance (Pty) Ltd the Labour Court was called upon to decide between two conflicting judgments. The case dealt with whether annual leave pay not taken within 18 months of the beginning of an employee’s leave cycle should be forfeited. The court decided that leave governed by the Basic Conditions of Employment Act, which applies only to the statutory minimum of 15 days per year, would be forfeited if not taken within this time period. Employers and employees cannot contract out of this. However, any leave given by the company over and above this minimum is considered contractual leave and the company itself will have to insert a forfeiture provision if it does not want this leave to be accumulated indefinitely.