Payment for work during leave
My employer assigned me work during my annual leave. I now want him to pay me double gross salary for the month I worked during my leave but HR is refusing to pay me on grounds that leave pay does not include allowances. Can you guide me on how leave pay is computed? Is it computed based on the basic salary or gross salary? Does the leave pay cover wage for weekends and public holidays not worked?
IP, Morogoro
Calculation of the leave pay depends on the reason for which leave is paid. In view of section 30(1)(c) and (7) read together with section 4 of the Employment and Labour Relations Act [Cap. 336 R.E 2019], leave pay in lieu of annual leave is calculated based on the basic wage of the employee. Section 4 of this Act defines basic wage in the exclusion of the allowances payable to the employee whether or not the allowances are calculated on the basis of the basic wage. The reason why leave pay in lieu of annual leave does not include allowance is that the allowances are covered for in the salary for the month worked while the employee is on annual leave. Paying gross wage in lieu of annual leave will amount to double payment of allowances like rent allowance, fuel allowance and other allowances payable to the employee monthly based on the employment contract.
However, if leave is paid as a terminal due, section 44(1)(b)(c) of the Act provides for untaken leave or accrued leave during any incomplete leave cycle and the calculation of leave pay shall be based on the remuneration of the employee. Section 4 of the Act defines remuneration to include allowances payable to the employee whether in kind or in cash. Remuneration is therefore an equivalent of gross wage.
By virtue of section 31(1) of the Act annual leave days are inclusive of weekends and public holidays that may fall under the leave period.