Can You Use Leave Credits Before Your Last Day at Work?

A Philippine labor-law guide for private-sector employees

The short answer

Usually yes—but it’s not automatic. You may request to use your accrued leave credits (e.g., vacation, sick, or service incentive leave) before your last day. Approval is subject to company policy and your employer’s scheduling discretion during your 30-day resignation notice. Any unused service incentive leave (SIL) must be paid in cash if not used, while other leave types are paid out only if your policy or CBA says so. Final pay (including any convertible unused leave) is typically released within 30 calendar days from separation.

Key idea: You can’t unilaterally place yourself on leave to avoid rendering the turnover period, but you also shouldn’t lose the cash value of legally mandated SIL if you don’t use it.

Legal bases you should know (plain-English)

Service Incentive Leave (SIL). By law, rank-and-file employees who have rendered at least one (1) year of service are entitled to a minimum of five (5) days leave with pay per year. Unused SIL is commutable to cash (paid at your current basic rate) if not used by year-end or upon separation.
- Who’s typically excluded from SIL? Government employees (different rules apply), domestic workers (covered by a separate law), certain field/unsupervised or purely commission/task-based workers, and employees already enjoying at least 5 days paid leave from company policy or CBA.
Resignation notice. If you resign without just cause, you must give 30 days’ written notice so the employer can manage turnover. The employer can deny or approve leave during this period based on business needs, or waive the notice (i.e., let you go earlier).
Final pay timing and contents. DOLE guidance provides that final pay is normally due within 30 days from separation, and commonly includes unpaid wages, pro-rated 13th month pay, and the cash conversion of unused vacation/sick leave if granted by policy/CBA, plus SIL conversion and any other benefits you’re entitled to.

Bottom line: SIL is a statutory minimum and its cash conversion is demandable; everything beyond SIL (extra vacation/sick leave, “earned” credits, carry-over, etc.) follows your company policy or CBA.

Can you take all your remaining leave during the notice period?

You can ask, but you need approval. Employers may:

Approve some or all of your requested dates (common when you’ve finished handover).
Reschedule or deny specific dates due to business exigency (e.g., peak operations, client deadlines, training your replacement).
Place you on paid “garden leave” (you stay employed and paid, but don’t report to work) or waive the notice and let you separate earlier.
Require render: Some employers require a minimum number of on-site turnover days and will encash the balance of your credits instead.

Tip: Propose a handover plan (deliverables, knowledge transfer, who will cover what). The better your plan, the more likely leave dates are approved.

What if the employer refuses to let you use your remaining leave?

SIL you didn’t use must be paid in cash at separation.
Other leave credits (vacation/sick beyond the 5-day SIL) are encashable only if your policy/CBA says so. If your handbook says “convertible upon separation,” that should be honored.
If your company front-loaded annual leaves (credited in advance) and you used more than you actually earned/accrued by the time you resign, expect a deduction from final pay for the “negative” balance—check your policy.

Special leave situations near your last day

These have distinct legal rules and are not purely at management discretion:

Maternity leave (RA 11210). If you’re still employed when the covered event occurs and you meet eligibility, you may go on maternity leave even if it overlaps with your notice period. (SSS pays the benefit; employers handle salary differential where applicable.)
Paternity leave (RA 8187). Usable by eligible married male employees within the statutory window of the child’s birth/miscarriage—if you’re still employed then.
Solo Parent leave (under the expanded Solo Parents’ Welfare law). Follow documentary and eligibility rules.
VAWC leave (RA 9262) and Special Leave under the Magna Carta of Women (for specified gynecological surgeries) have dedicated requirements and cannot be denied if you qualify.

If the qualifying event happens after you separate, you generally can’t avail of employer-based leave (you’re no longer an employee), though SSS benefits may have separate rules and look-back periods.

How many days can you actually use?

Accrued vs. front-loaded. Many employers accrue leave monthly (e.g., 1.25 days/month). You can normally use what you’ve already accrued. If your company front-loads the full year and you resign mid-year, you may be limited to the pro-rated portion—or excess usage can be clawed back from final pay.
Sick leave standards. Using sick leave typically requires good-faith illness; multiple consecutive days often require a medical certificate per policy. Employers can treat “sick leave” as vacation leave with your consent if you’re not actually ill.
“Offsetting” absences. It’s common to offset last-minute absences or tardiness with remaining leave credits if policy allows.

Encashment & taxes (practical notes)

SIL cash conversion is mandatory if unused.
Other leave conversions follow policy/CBA.
Tax treatment: Under BIR rules, certain monetized unused vacation leave amounts (up to a threshold) may be treated as de minimis and non-taxable; amounts beyond that are taxable compensation. (Thresholds and rules can change—your payroll should apply the current BIR issuances.)

Step-by-step: How to use leave before your last day

Check your handbook/CBA. Note: (a) accrual method, (b) conversion rules, (c) blackout dates, (d) documentation.
Compute your balance. Confirm accrued vs front-loaded credits and your SIL status.
Draft a turnover plan. List deliverables, handover owners, and coverage timeline.
File a formal leave request. Attach your turnover plan and propose dates.
Get written approval. Keep email or HRIS screenshots for your records.
Finalize clearances. Return assets, submit final timesheets/expense claims, and confirm final pay components and release date.

Sample email you can adapt

Subject: Request to Use Leave Credits Prior to Separation Hi <Manager data-preserve-html-node="true">, As discussed, my resignation is effective <date data-preserve-html-node="true">. Per policy, I have <X data-preserve-html-node="true"> vacation/sick leave days (including <Y data-preserve-html-node="true"> days of SIL) accrued as of <cut data-preserve-html-node="true"-off date>. Attached is my handover plan (deliverables, coverage, and knowledge-transfer schedule). May I use <dates data-preserve-html-node="true"> as leave, and encash any remaining SIL and convertible leave credits in my final pay? Please let me know if you need adjustments to ensure a smooth turnover. Thank you, <Your data-preserve-html-node="true" Name>

FAQs

1) Can my employer force encashment instead of letting me go on leave? They can deny specific dates for legitimate business reasons and encash your unused credits per policy; SIL must be paid if unused.

2) Can I use leave to “cover” the entire 30-day notice so I don’t report to work at all? Only if approved (or the employer waives the notice or places you on paid leave). Otherwise, you’re expected to render.

3) I’m being terminated (redundancy/closure). Can I still use leave? Management may set your last day and pay out your unused credits (SIL must be paid). Using days as leave is a management decision; payout is the usual route.

4) Will I lose my leave credits if I resign without 30 days’ notice? You may be liable for damages if you don’t observe the notice requirement (unless you have just cause), but earned benefits like unused SIL should still be paid. Policy will govern other leave conversions.

5) Are managers/probationary employees covered by SIL? SIL vests after 1 year of service. If you have less than 1 year, SIL hasn’t vested yet; company-granted leaves (if any) depend on policy.

Quick checklist before you resign

Confirm leave balances (SIL vs. company leaves).
Verify convertibility rules in your handbook/CBA.
Align with your manager on a turnover plan.
File leave with proposed dates; keep written approvals.
Get final pay breakdown and release date in writing.
Keep copies of clearances and COE request.

Final reminders

This guide focuses on the private sector. Government employees have different “terminal leave” rules under the Civil Service system.
Company policies that are more generous than the legal minimum are permitted; lesser benefits can be unlawful.
Labor, tax, and SSS rules change from time to time. When stakes are high, consider consulting HR or a labor lawyer with your actual policy text, payslips, and leave ledger.

If you want, send me your leave policy excerpt and your balance numbers, and I’ll help you map out the best mix of leave days vs. encashment for your situation.