Annual Leave as per UAE Labour Law

Annual leave for Employees as per UAE Labour Law

There are various types of Leaves that an employee is entitled to:

  1. Annual Leave,
  2. Sick Leave,
  3. Maternity Leave(only for women!)

In this post I will cover Annual Leave.

annual-leave-laws

Annual leave is a basic right of every employee guaranteed by the UAE Labour Law. Full-time employees working in the UAE are entitled to leave and holidays as per laws in the country, which broadly include annual or recreation leave, sick and maternity leave.

Mandatory leaves in UAE: As per Section- 2 Article (74), every employee is entitled to an official leave with full pay on the following occasion:

  • Hijri New Year’s Day - one day
  • Gregorian New Year’s Day-  one day
  • Eid Al Fitr (end of Ramadan)-  two days
  • Eid Al Ada and Waqfa - three days
  • Prophet Mohammed’s Birthday-  one day
  • Isra and Al Mi’raj-  one day
  • National Day - one day

As per Article (75)- Each employee is entitled for annual leave after completing each year of service as mentioned below:

  • Two days leave for every month if his service is more than six months and less than a year.
  • 30 days annually if his service exceeds one year. At the end of the service the employee is entitled to an annual leave for the fraction of the last year he spent in service.

As per the Article (76)- The employer may at his discretion determine the date for commencement of annual leaves and, when necessary, he may decide to divide the leave in two parts at the most, except in cases of juveniles where vacation may not be divided in parts.

As per the Article (77)- The calculation of duration of annual leave shall include holidays specified by law or by agreement, or by any other day because of sickness if they fall within the leave and shall be deemed to be part thereof.

As per the Article (78)- An employee shall be paid his basic wage plus the housing allowance, if applicable, and any other allowances which he receives in the normal working month.

If however, work circumstances require keeping the employee during whole or part of his annual leave and the leave has not been carried over for the following year, then the employer shall pay him his wage in addition to a leave allowance for the day he worked equal to his basic wage

As per the Article (79)- An employee is entitled to receive cash in lieu of annual leaves not availed by him, if he was dismissed or if he left the service , after the period of notice stipulated by law. Cash in lieu is calculated on the basis of pay received by the employee at the time of maturity of such leave.

In other words, the employee is entitled to payment for the annual leave period not taken if the employment is terminated either by way of resignation or termination. Such payment is calculated on the basis of the basic wage received at the time the leave was due.

Accrued leave pay is based on only basic pay it doesn’t includes housing, transport or other allowances.

As per the Article (80)- Annual leave shall be paid to the employee before taking his annual leave, the employee shall be paid his full wage, plus the wage of his leave days he deserves according to the provision of this law.

An employee cannot work for another company during the annual leave, if you do so an employer has the right to terminate your service without notice and withdraw him of the leave pay due to him

Every employee must report to work upon completion of annual leave. Upon failure to report to duty, the employer has the right to withdraw of his pay for the period of absence commencing from the day following to the date on which the leave has expired.

Except under Article 120 of the Act, The UAE Labour Law does not allow an employer to dismiss or issue termination warnings to employees when they are on annual leave.

Annual Air Ticket en cashing procedure:

Air ticket policy is very flexible in nature. It is a benefit in kind not in cash so it shouldn’t be encashed. Annual Air ticket procedure is related to company policy and practice and it is not covered under UAE Labour Law.


Deepak is a Credit and Risk professional, with interests in Technology, Business Quizzing, Reading, Writing, Table Tennis and Photography.

18 Responses to “Annual Leave as per UAE Labour Law”

  1. Bev'z

    Mar 31. 2014

    Mr. Deepak.. please help me with my annual leave computation…

    Reply to this comment
  2. Bev'z

    Mar 31. 2014

    Hello Sir,

    Good afternoon,

    May I know the exact computation of Annual Leave? For example my basic wage is 1,000 plus 750 in home allowances and 750 for transportation… total of 2,500.. under UAE labour law “An employee shall be paid his basic wage plus the housing allowance, if applicable, and any other allowances which he receives in the normal working month.” Is it means that I will received a total of 2,500 as my annual leave payment? Please help me with this…..

    Reply to this comment
    • Bev'z

      Mar 31. 2014

      The normal working month that I received is 2,500… plus 500 cash on hand in my boss. My total salary is 3000 but he include only 2500 in contract and he informed to me 500 will be given to me cash…
      I dont know how much I will be receiving for my annual leave.

      Please Mr. Deepak please help me.. by boss is telling me that I will receive only 1,000 because its my basic page in my contract.. but what is the meaning of this “plus housing allowance and any other allowances which you receives in the normal working month”…..

      Please there’s anyone who can answer me,, I need your help please.

      Please I need your reply…

      Reply to this comment
    • Deepak M

      Apr 01. 2014

      You need to get same salary (what you recieive in other months) during your vacation leave

      Reply to this comment
      • Bev'z

        Apr 01. 2014

        Thanks Mr. Deepak.. but sir according to my boss as per to company policy you will received only basic pay which is 1000 only.. What will I do sir? and what should I tell to him (like proof or any evidence) that would convince him to give the correct annual leave payment) Do you have any legal documents sir so that I will show that to him. Im new in company and all employees they encounter the same.. not full salary…, I want him to be oblige what is due to us.., Any legal article, law that can help us sir…, My plan is I will show to him the article 78 in UAE labor law.. is this correct….

        Reply to this comment
      • Bev'z

        Apr 01. 2014

        Can you recommend any person who can help us with this sir.. person we can contact sir…, because of course I want to received that full and I’m sure he will insist on this.. and he will even threaten us… Like before…, his always like this…,

        Reply to this comment
  3. SUMESH

    Mar 31. 2014

    USUALLY ALL THE EMPLOYEES IN OUR COMPANY TAKE LEAVE FOR A PERIOD OF 3-5 MONTHS YEARLY. THEN HOW IS THE ANNUAL LEAVE AND PAY CALCULATED?

    Reply to this comment
  4. Shefeer

    Mar 26. 2014

    I work 1 year and 10 days in a company. As per as per my appointment letter, company should pay my annual leave two way plane ticket at the time of my annual leave in every year. But I didn’t go vacation and now I terminated from the company. Is I am eligible to get my two way air ticket cost plus one way ticket which is for termination going to home country. Total 3 way ticket costs ?

    Reply to this comment
    • Deepak M

      Mar 30. 2014

      it depends on company policy. However you are entitled for one way air ticket as per law. It will be depend on company to pay you the cost of return ticket. However since you are terminated you are entitled for one way air ticket to your home country

      Reply to this comment
  5. Bronwyn

    Mar 25. 2014

    I work under Tecom and my contract states a probation period of 6 months. I was terminated after 5 months. Is my company liable to pay me for my accrued leave over the 5 months I was there?

    Reply to this comment
  6. Kriengsak S.

    Mar 15. 2014

    Dear Sirs,

    Please help me clarify for yearly annual leave.

    1 I worked complete 1st year, I already received 30 days annual leave.
    2 If 2nd year, I worked only 8 month. After that Company finished job, How many day the company will calculate for my annual leave benefit ?

    Reply to this comment
    • Deepak M

      Mar 17. 2014

      You will be entitled for the leave as per your agreement and company policy

      Reply to this comment
  7. Josephine

    Feb 16. 2014

    I have the same question, if the salary changes, for example I within 1 year I have promotions and increment from 3000 salary becomes 3,800. Where I will base my vacation salary? Thanks hoping for a response.

    Reply to this comment
    • Deepak M

      Feb 17. 2014

      In my opinion it will be on present salary.

      Reply to this comment
    • Vincent

      Apr 15. 2014

      @Josephine on Feb 16,2014 on your last drawn salary always. Just as Gratuity payable.

      #ThankYou. #StayEasy

      Reply to this comment
  8. kawoon

    Jan 08. 2014

    From which salary should they base the leave salary? For example: I did not go for vacation for the last 3 years and my salary changes. Should they calculate it base on your salary on every year or they have to calculate it on your latest salary?

    Reply to this comment

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