Written by the Fiveable Content Team • Last updated September 2025
Verified for the 2026 exam
Verified for the 2026 exam•Written by the Fiveable Content Team • Last updated September 2025
Definition
Annual leave refers to paid time off granted by employers to employees for vacation purposes. It allows workers to take time away from work while still receiving their regular salary.
Related terms
Sick leave: Sick leave is time off granted to employees when they are ill or need medical attention. It allows them to recover without losing their regular pay.
Maternity/paternity leave: Maternity/paternity leave is time off given to new parents after the birth or adoption of a child. It allows them to bond with their child and adjust to their new family dynamics.
Paid time off (PTO): PTO refers to a flexible policy that combines vacation, sick, and personal days into one bank of hours that employees can use for various reasons. It offers more flexibility in managing time off.