Can an employer deduct annual leave from an employee's entitlements without informing them? Our employee was taking a management enforced break due to fatigue & illness. The employee assumed it was to be a combination of sick leave & accrued R&R days (nothing was put in writing by either party as to the type of leave). However the company has decided to terminate their employment contract & payroll need to know if they have correctly booked this time as annual leave.