Annual leave, also called vacation or paid time off, gives employees paid days away from work. Most countries mandate minimum annual leave entitlements, though amounts vary significantly around the world.
Global Minimums
Statutory minimums range widely. The EU mandates at least four weeks for all member states. Australia requires four weeks. Japan starts at 10 days increasing with service. The United States has no federal requirement, leaving it entirely to employer discretion.
Accrual and Carryover
Leave typically accrues throughout the year, though some employers grant the full entitlement upfront. Rules about carrying unused leave into the next year vary by jurisdiction. Some countries require employees to take minimum amounts of leave or limit carryover to encourage rest.
Payment on Termination
Most jurisdictions require employers to pay out accrued but unused annual leave when employment ends. This applies whether the employee resigns or is terminated. The calculation typically uses the employee's regular rate of pay at termination.