New Labour Law Recognises Leave Encashment Rights for Workers

New Labour Law Recognises Leave Encashment Rights for Workers. In a significant reform for Botswana’s labour landscape, Section 219 (6) of the new Employment Act now legally recognises leave encashment—a long-debated issue that previously lacked clarity under existing labour laws.

For the first time, the law explicitly provides that where no agreement exists between the worker and the employer on when annual leave should be taken within a leave cycle, and after at least two failed attempts to schedule the leave, the worker becomes entitled to receive 35 percent of the monetary value of their accrued leave.

This provision acknowledges a common workplace challenge—situations where operational demands or scheduling conflicts prevent employees from taking their earned leave. Instead of forfeiting those days, employees will now have a statutory right to claim part of their unused leave as cash.

Under the previous Employment Act, encashment was vaguely referenced and mostly applied upon termination of employment, leaving many workers without recourse during active service. Subsection (6) closes this gap by creating a clear legal entitlement for partial leave encashment while still employed.

Labour experts have welcomed the reform, noting that it strikes a balance between employee welfare and business flexibility. It also compels employers to proactively plan leave schedules or compensate staff fairly when leave cannot be taken for reasons beyond their control.

For Botswana’s entrepreneurs and business owners, this change underscores the need for stronger HR compliance systems to manage leave records, maintain transparent communication with employees, and avoid disputes over accrued leave.