Can leave be taken during the notice period in Myanmar?
Yes — accrued annual leave can be taken during the notice period in Myanmar with employer agreement under the ESDL 2013. The employer can refuse on operational grounds, in which case unused balance is encashed at final settlement using (monthly salary ÷ 30) × unused-days. Casual and sick leave during notice are restricted to genuine emergencies.
What Myanmar law says
Yes — accrued annual leave can be taken during the notice period in Myanmar with employer agreement, under the Employment and Skills Development Law (ESDL) 2013. The notice period itself is set by the ESDL: 1 month for service of less than 5 years and 3 months for 5+ years (employer or employee initiated). Within the notice period, the employer retains the right to refuse leave on operational grounds; if refused, the unused balance is encashed in the final settlement using the standard formula (monthly salary ÷ 30) × unused-leave-days.
The same rules apply under the Factories Act 1951 and the Shops and Establishments Act. Casual and sick leave during notice are restricted to genuine emergencies — they are not designed to bridge the notice period.
What can and cannot be taken during notice
| Leave type | During notice — allowed? | If refused |
|---|---|---|
| Annual leave | Yes — with employer agreement | Encashed at exit |
| Casual leave | Genuine emergencies only | Lapses (not encashable) |
| Sick leave | If genuinely ill, with medical certificate | Lapses (not encashable) |
| Public holidays | Always paid as gazetted | Paid in normal payroll |
| Maternity leave | Yes — termination during maternity is prohibited | Notice paused until end of maternity |
How to handle leave during notice — step by step
- Determine the notice period. Per the ESDL 2013 schedule (or contract, whichever is greater).
- Calculate accrued balance. Compute leave to last working day, including any pro-rated current-year accrual.
- Apply for leave during notice. Employee submits written request; employer responds within 2–3 working days.
- Approval or refusal. Employer can refuse on documented operational grounds — typically the need for handover.
- Encashment. If leave is not taken, unused balance is paid at final settlement within 7 days of the last working day.
Worked examples
Example 1 — leave taken during notice. Employee earns MMK 800,000/month, gives 1 month notice, has 7 days accrued annual leave at notice start. Employer agrees to leave for the second half of the notice month:
- Notice period: 1 month, fully worked except 7 days of annual leave
- Annual leave used: 7 days (not encashed; salary continues during leave)
- Encashment at exit: 0
Example 2 — leave refused, encashed at exit. Same employee, 7 days unused balance, employer refuses leave on handover grounds:
- Notice period: 1 month, fully worked
- Encashment: (800,000 ÷ 30) × 7 = MMK 186,667 on final settlement
Garden leave
Some contracts allow the employer to require garden leave during the notice period — the employee remains on payroll but is not required to attend work, often to protect confidential information when joining a competitor. Garden leave is paid at full salary; accrued annual leave is not separately taken because the employee is already off-site. See bucket E for the contract-side rules.
Edge cases and exceptions
- Probationary notice. 2 weeks notice during probation. Annual leave is statutorily ineligible during probation, so this question is mostly moot — casual leave can be taken if approved.
- Maternity overlap. Termination during maternity is prohibited; the notice period is suspended until after maternity ends.
- Sick leave during notice. Genuine illness with medical certificate is honoured; absence beyond the medical reason is not.
- Daily-wage workers. Encashment uses the daily wage rather than (monthly ÷ 30); same approval rules.
- Foreign workers. Same rules; visa-departure logistics may justify approving leave at the end of notice.
- Pay in lieu of notice. If the employer pays in lieu of notice, the relationship ends immediately and unused leave is encashed at the same point.
- Termination for misconduct. Annual leave is still encashed; only severance can be withheld for gross misconduct.
Employer takeaway
Allow accrued annual leave to be taken during the notice period subject to operational sign-off; if refused on documented handover grounds, encash unused balance at final settlement using (monthly salary ÷ 30) × unused-days, paid within 7 days of the last working day. Casual and sick leave during notice are limited to genuine emergencies. Pause notice during maternity. Document every refusal in the leave register and retain records for at least 7 years.
Frequently asked questions
Does this entitlement apply to employees on fixed-term contracts?
Yes. Fixed-term contract employees in Myanmar receive the same statutory leave floor as permanent employees once they meet the relevant service-tenure thresholds. The Leave and Holidays Act, the Factories Act 1951, and the Shops and Establishments Act do not distinguish between fixed-term and indefinite contracts for leave purposes — eligibility is set by months of continuous service. Contract expiry is not termination, so unused annual-leave balance is encashed at the end of the contract using (monthly salary ÷ 30) × unused-days. See the bucket E pages on fixed-term contracts for the contract-side rules.
How does this interact with payroll and SSB?
All paid leave is treated as ordinary salary income for Myanmar payroll purposes. PIT is withheld through PAYE on every payslip that includes leave pay. SSB contributions (2% employee + 3% employer, capped on a wage base of MMK 300,000/month) continue during paid leave because the employee is still earning wages. SSB contributions pause only during unpaid leave. Encashment of accrued annual leave at exit is part of taxable salary for PIT but practitioners differ on SSB treatment of the lump sum — confirm with the township SSB office on filing.
What records does the township labour office expect?
Inspectors typically request the leave register for the past 12 months, medical certificates for sick leave over 3 days, maternity / paternity SSB filings, final settlement worksheets for recent leavers, and the public-holiday gazette for the current year. Records must be retained for at least 7 years under both the Factories Act 1951 and the Shops and Establishments Act. Keeping a clean per-employee leave file with tagged entries makes inspections quick and defensible. Digital records from a payroll system are acceptable provided they can be printed on demand.
Common leave-law mistakes
- Refusing leave without documented reason. Operational grounds must be in writing.
- Failing to encash refused balance. Encashment is statutorily owed at exit.
- Allowing sick leave to mask non-attendance. Require medical certificates for sick leave during notice.
- Forgetting maternity overrides notice. Termination during maternity is prohibited.
- Mixing pay-in-lieu with separate encashment. Show each component as a distinct line on the final settlement.
- Employment and Skills Development Law (ESDL) 2013 — Notice period and final settlement
- Leave and Holidays Act — Annual leave and encashment
- Factories Act 1951 — Notice period rules for factory workers
- Shops and Establishments Act — Notice period rules for offices and retail
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