Many employees resort to requesting a "five-year leave" with the desire to dedicate their time to starting their own projects or establishing commercial companies. They often assume that a temporary break from their official duties lifts legal restrictions and allows them to enter the business sector freely.
Does the Leave Sever the Employment Relationship?
The belief that a long-term leave permits engaging in commerce is a misconception. Obtaining a leave (regardless of its duration) does not sever the employee's relationship with the civil service, nor does it terminate the legal bond between the employee and their department.
The employee on leave retains their status as a "public employee" and is therefore subject to the same prohibitions imposed on an active employee. Engaging in any commercial activity or establishing a company during the leave period exposes the employee to disciplinary accountability, which may result in severe administrative penalties.
The Legal Basis for the Prohibition
Pursuant to Article 5/Second of the State and Public Sector Employees Discipline Law No. 21 of 1991, as amended, an employee (whether actively serving or on leave) is prohibited from the following:
Engaging in commercial activities.
Establishing companies in all their legal forms (such as limited liability companies, partnerships, or sole proprietorships).
Assuming the position of a Managing Director or holding membership on boards of directors.
This rule is designed to ensure that the status of a public employee does not conflict with personal endeavors for financial profit, and to prevent the exploitation of their position or influence (which they legally still possess) to achieve personal gains.
What is the Legal Alternative Available for an Employee on Leave to Invest?
Despite this strict prohibition, the law has not completely closed the door for employees wishing to invest their funds during their leave. Rather, it has provided safe legal exceptions stipulated in the same article, which include:
Purchasing Shares in Joint-Stock Companies:
The employee is permitted to own shares in joint-stock companies (corporations). The rationale here is the separation of ownership from management; the employee merely subscribes to the capital and their liability is limited to the value of their shares, without interfering in the executive or day-to-day management of the company. This purely financial investment does not confer upon them the "status of a merchant" and does not conflict with their official duties.
Managing Inherited Funds:
The employee may manage businesses related to funds they have inherited, or manage the inherited funds of their spouse or relatives up to the third degree. The law stipulates that the employee must notify their department of this within thirty (30) days. The competent minister then has the authority to assess whether such management harms the public interest and to take appropriate action.
Conclusion
In summary, the five-year leave is a sabbatical period granted for specific reasons, which may be personal or otherwise; however, it is not a gateway to engaging in commerce or managing companies. The law draws clear boundaries: purely financial investment through shares in joint-stock companies is accessible and permissible, whereas establishing companies and engaging in direct commercial management is strictly prohibited as long as the status of "public employee" remains legally effective.
