Media Focus: After 18 Years, Paid Annual Leave System May "Get a New Update": How to "Take All Eligible Leave"?

The “Regulations on Paid Annual Leave for Employees” stipulate: employees who have worked for 1 to 10 years are entitled to 5 days of annual leave; those with 10 to 20 years get 10 days; and over 20 years, 15 days. If leave cannot be arranged due to work needs, the employer should compensate at 300% of the daily wage. This regulation has been in effect since January 2008, for 18 years.

After 18 years, a system that concerns the rest and vacation rights of 402 million employees may be “renewed.”

Recently, the Ministry of Human Resources and Social Security stated at a routine press conference that it will promote revisions to the “Regulations on Paid Annual Leave for Employees” to encourage employers to implement this system. The topic of paid annual leave has once again sparked widespread discussion.

In China, employees’ right to paid annual leave can be traced back to the Labor Law enacted in 1994. The Regulations on Paid Annual Leave for Employees officially came into effect on January 1, 2008. The same year, the Implementation Measures for Paid Annual Leave for Enterprise Employees were issued, further detailing the rules and forming a relatively complete system framework.

During interviews, many employees expressed that they “want to take leave but dare not,” fearing impact on performance evaluations and promotions. Some companies selectively enforce the rules, exploiting “loopholes” to diminish employees’ rest rights. Experts interviewed said that closing loopholes, optimizing supply, and strengthening rigidity are core issues in this revision, aiming to turn “want to rest but dare not” into “must rest and can rest.” This is not only about restoring rights but also about upgrading the system.

Implementation Challenges Remain a Practical Issue

Despite years of legal recognition, the difficulty in implementing paid annual leave remains a major challenge.

“One carrot, one hole—worried about colleagues’ opinions,” “afraid it will affect performance, assessments, and promotions”… Many employees shared their concerns during interviews.

Data confirms this dilemma: In 2020, the Ministry of Human Resources and Social Security responded to suggestions from National People’s Congress deputies, stating that the popularization rate of paid annual leave was about 60%, meaning nearly 40% of employees had not enjoyed this statutory right. A December 2024 survey by 51Job showed that nearly 70% of workers did not take their full annual leave.

Behind the “difficulties in taking leave” are selective enforcement by some companies and deliberate exploitation of “loopholes” in the rules.

Some companies intentionally confuse “cumulative work experience” with “work experience in their own unit,” “reset” seniority when employees switch jobs; others offset paid annual leave with statutory holidays like maternity or marriage leave; some forcibly fragment annual leave, greatly reducing workers’ rest rights.

How to revise regulations to close loopholes, refine rules, and limit employers’ “maneuvering space” is highly anticipated.

Xiao Zhuzhu, Director of the Scientific Research Department and Dean of the Law School at China Institute of Labor Relations, pointed out that issues such as standards for calculating seniority, rules for offsetting leave, cross-year leave arrangements, and the legal validity of waivers all need clarification, refinement, and regulation through revisions.

In recent years, proposals and suggestions to improve the paid annual leave system have increased at the national two sessions, providing references for the system’s revision. The Ministry of Human Resources and Social Security responded that it will strengthen research on increasing the standards for paid annual leave.

Shen Jianfeng, Chair of the Academic Committee of the Law School at China Institute of Labor Relations, believes that revising the regulations is not simply about “adding” but about ensuring workers’ rest rights while considering enterprise production realities and capacity, designing more precise and feasible systems to truly implement paid annual leave.

Regulation Enforcement Needs Real “Teeth”

The core reason for the difficulty in implementing paid annual leave lies in the insufficient rigidity of the system and weak enforcement.

“Legislate the Regulations on Paid Annual Leave at a higher level, clearly defining paid annual leave as a statutory labor right,” Xiao Zhuzhu suggested.

He noted that some provincial documents still describe the implementation of paid annual leave as “an important social welfare system established by the state,” which weakens the legal attribute of paid annual leave. Additionally, Article 10 of the Implementation Measures for Paid Annual Leave states that if an employee, for personal reasons, formally requests not to take leave, the employer can pay only the regular wages for the work period.

These “ambiguous areas” leave room for companies to evade legal obligations and make it harder for workers to defend their rights.

Analysis of relevant cases shows that the legal recognition of wages for unused paid leave has long been a contentious issue. Some court rulings hold that in the 300% unpaid leave wages, 100% is wages, and the remaining 200% is statutory compensation rather than labor remuneration, applicable from the day the leave should have been taken but was not.

Shen Jianfeng explained that most workers are reluctant to confront employers while still employed, and only apply for arbitration after leaving, often exceeding the statute of limitations, leading to failed rights protection.

“Employers can ‘wait two years’ without responsibility, greatly weakening the deterrent effect of the system,” Xiao Zhuzhu said.

Experts generally recommend clarifying that unpaid leave wages are labor remuneration, applying a special arbitration statute of limitations starting from the employee’s departure, thereby lowering the threshold for workers to defend their rights.

Strengthening system rigidity also requires truly “longer teeth” in supervision.

Xiao Zhuzhu suggested enhancing proactive and targeted labor inspections, punishing companies that refuse to implement paid leave laws according to law. Meanwhile, trade unions at all levels should fully utilize their legal supervisory functions to safeguard employees’ rights.

Wang Tianyu, Deputy Director of the Social Law Research Office at the Chinese Academy of Social Sciences Law Institute, proposed a flexible approach: encouraging companies to arrange concentrated leave during off-peak production periods through detailed labor management; incorporating the implementation of paid leave into evaluations of harmonious labor relations and corporate awards; and providing incentives such as tax reductions and policy support for companies that fully implement the system.

Helping to Unlock Employees’ Consumption Potential

At this year’s provincial two sessions, provinces like Guizhou, Henan, Shandong, and Hubei explicitly included the implementation of staggered paid leave policies in their government work reports, demonstrating local determination to promote the system.

In recent years, the value of paid leave has gradually increased. The General Office of the State Council issued the “Several Measures to Further Cultivate New Growth Points and Prosper Cultural and Tourism Consumption” on January 9, 2025, which proposed to release employees’ consumption potential by “encouraging units and employees to combine paid annual leave with traditional festivals and local特色活动,安排错峰休假.”

“Leave can stimulate workers’ consumption potential and promote a healthy economic cycle,” Shen Jianfeng calculated: the approximate annual working days for each worker is 248 days. Taking the shortest 5-day paid leave as an example, 50 workers taking leave can free up one job opportunity for another worker.

From the “14th Five-Year Plan” proposals to the 2025 Central Economic Work Conference, the concept of “investing in people” has been repeatedly emphasized. Wang Tianyu sees paid leave as a concrete practice of this idea. Protecting rest rights benefits workers’ physical and mental health, better realizes social values, and promotes comprehensive human development.

With the rapid development of new business formats, whether workers in emerging employment models should enjoy paid annual leave rights has become an unavoidable topic in this revision.

Guo, a Beijing ride-hailing driver, told reporters he also wants to take leave but cannot stop working without losing income. “If I stop, I won’t earn anything,” he said.

Xiao Zhuzhu pointed out that the main challenges for new employment model workers’ paid leave protection are: diverse employment subjects, blurred responsibility boundaries, difficulty in clarifying who should be responsible for leave guarantees; income linked to working hours, so taking leave means less income, objectively affecting willingness; and dispersed worker distribution with proof difficulties, making rights protection hard.

He suggested providing tiered and categorized protection plans: workers with clear employment relationships should enjoy statutory paid leave rights; those not fully meeting employment relationship criteria should have leave rules linked to their platform working hours and continuity.

Shen Jianfeng stated that China’s new employment models are complex and diverse, and this revision is unlikely to specifically design general rules for new employment model workers.