Outstanding Annual Leave – What Employers Need to Know Before September 30

The issue of outstanding annual leave, while seemingly straightforward at first glance, raises a number of interpretative and organizational challenges in practice. Both employers and employees frequently face questions regarding deadlines for taking outstanding leave, the possibility of splitting leave into parts, and the legal consequences for employers in case of non-compliance with statutory deadlines.

Employer Obligation – Granting Leave in the Year It Is Accrued

Pursuant to Article 161 of the Polish Labour Code (hereinafter “Labour Code”), an employer is obliged to grant annual leave within the calendar year in which the employee accrues the right to it. If this obligation is not fulfilled, the leave becomes outstanding leave. In such cases, Article 168 of the Labour Code applies, imposing on the employer the obligation to grant the employee outstanding leave no later than September 30 of the following calendar year.

It is important to emphasize that outstanding leave does not lapse if not taken within the statutory timeframe. The employee retains the right to the leave, and the employer retains the obligation to grant it.

Is Leave Required to Be Fully Taken by September 30?

In practice, questions often arise as to whether the employee must fully utilize outstanding leave by the end of September. The answer is: no. The employer fulfills its obligation if the employee is allowed to commence outstanding leave by September 30. The leave may extend beyond September, provided it begins within the statutory deadline.

Leave Planning and Outstanding Leave

As a general rule, leave should be granted in accordance with an annual leave plan prepared by the employer. Employers may be exempt from preparing such a plan only if a trade union does not operate at the workplace or has consented to its absence. In such cases, leave dates are agreed individually with the employee.

Outstanding leave, like regular leave, should be included in the leave plan or otherwise agreed with the employee. The Labour Code does not establish separate rules for granting outstanding leave beyond the statutory September 30 deadline.

Splitting Outstanding Leave

Outstanding leave may be split into parts, similar to regular leave. The rule requiring at least 14 consecutive days of leave does not apply. However, it is essential that the final portion of outstanding leave is granted by September 30.

When Can Outstanding Leave Be Postponed?

The law permits postponement of leave only in certain obligatory circumstances, such as temporary incapacity for work due to illness, quarantine in connection with an infectious disease, or conscription for military service. In such cases, outstanding leave must be granted later, once the obstacle preventing its use has ceased.

Unilateral Granting of Leave by the Employer

There has long been debate over whether an employer may unilaterally send an employee on outstanding leave. Polish law permits such unilateral action only during the notice period. According to Article 167¹ of the Labour Code, during the notice period, the employee is obliged to take leave if granted by the employer.

Outside the notice period, there is no legal provision allowing the employer to unilaterally grant leave – whether current or outstanding – without the employee’s consent. Jurisprudence is not fully uniform, but the prevailing view is that Article 168 of the Labour Code grants the employer the authority to ensure that outstanding leave is taken, as it imposes an unconditional obligation to grant such leave.

The Supreme Court held in its judgment of 2 September 2003 (case no. I PK 403/02) that granting annual leave for previous years under Article 168 Labour Code in the first quarter of the following year (currently by September 30 of the following year in the case of outstanding leave) does not require the employee’s consent. A similar position was expressed in the Supreme Court judgment of 7 May 2008 (case no. II PK 313/07), emphasizing that the employer is bound by the statutory deadline for granting outstanding leave.

This position was further confirmed by the Ministry of Family, Labour and Social Policy in a 2020 parliamentary inquiry, indicating that an employer may place an employee on outstanding leave even against their will, provided the leave must be granted within the statutory deadline.

At the same time, the State Labour Inspectorate takes a more restrictive position, asserting that, outside the notice period, granting leave without the employee’s consent infringes upon employee rights. In practice, this means that employers should seek to agree on the leave schedule with the employee while ensuring compliance with the September 30 deadline.

Statute of Limitations for Leave Claims

Although leave does not lapse, claims for its granting or for monetary compensation for unused leave become time-barred three years from the date the claim becomes enforceable. This prevents indefinite claims by employees and provides legal certainty for employers after this period.

Consequences for Employers

Failure to grant outstanding leave by September 30 constitutes an offence against employee rights. Employers may be liable to a fine ranging from PLN 1,000 to 30,000. The State Labour Inspectorate has authority to conduct inspections and impose financial penalties in this regard.

Conclusion

Granting outstanding annual leave by September 30 of the following calendar year is not optional – it is a statutory obligation under Polish labour law. Failure to comply exposes the employer to legal and financial consequences. While outstanding leave does not lapse, timely granting remains a core duty of the employer. To mitigate risks, employers should meticulously plan leave, including outstanding leave, and continuously monitor its utilization by employees.

attorney at law Marta Strzecha-Bociąga

legal assistant Julia Sośniak