In 2024, employees in the United Arab Emirates (UAE) are often curious about how their salaries are calculated during annual leave. It’s a common concern: Will their pay be based solely on their basic salary, or will they receive their full salary, encompassing additional allowances such as housing?

This article addresses these questions and provides a comprehensive insight into the intricacies of leave salary calculation. If you want to find a job in UAE, then read our full article Average Salary in the United Arab Emirates for 2024 which covers the salaries in different sectors and cities in the UAE. Learn how to calculate your leave salary in the UAE, based on length of service, according to UAE Labor Law.

Exploring the UAE Labor Law on Annual Leave

UAE Labor Law on Annual Leave

The UAE Labor Law, Federal Decree-Law No. 33 of 2021, determines annual leave entitlement based on an employee’s service length. Employees with under six months of service get no leave. Those with six months to one year receive two days of leave per month. After one year, they’re entitled to a full 30 days of leave.

Calculate Leave Salary in UAE

Calculate Leave Salary in UAE

Determining how an employee’s salary is calculated during their annual leave hinges on the timing and context. Article 29(1) of the UAE Labor Law clarifies that employees taking a 30-day annual leave after 12 months of employment are entitled to their full monthly salary.

This includes both the basic salary and any additional allowances. It’s crucial to note that the calculation of salary takes a different course when employees opt for encashment of unused annual leave upon leaving their jobs.

In this scenario, Article 29(9) of the UAE Labor Law dictates that the salary should be calculated based solely on the employee’s basic salary, excluding any supplementary allowances.

Dealing with Unpaid Salary During Annual Leave

When employers fail to pay the full salary during an employee’s annual leave, employees can file a complaint with the Ministry of Human Resources and Emiratisation (MOHRE). MOHRE actively engages both parties in resolving the issue.

Dealing with Unpaid Salary During Annual Leave

If a resolution is not reached, MOHRE escalates the matter to the labor court to ensure that employees receive their entitled relief in compliance with the law. This process serves as a recourse for employees to address salary discrepancies during annual leave.

Rules and Regulations for Annual Leaves in the UAE Private Sector

In the UAE, employees should be well-informed about not just the annual leave salary calculation but also the private sector’s specific regulations concerning annual leave.

Key guidelines include:

  1. Timely Usage: Employees must use their annual leave within the same year it becomes available, with flexibility for employers to set the dates one month in advance to meet work demands.
  2. Carryover Option: Employees, with consent and adherence to company rules, can carry forward unused annual leave to the following year, with payment based on their basic salary for the days worked during leave.
  3. Time Limit: Employers cannot prevent employees from using accrued annual leave for more than two years. Upon employment termination, any unused leaves are calculated based on basic salary only.
  4. Inclusive Period: Annual leave duration encompasses official holidays and sick leaves unless otherwise specified in the employment contract or company regulations. Understanding these rules is vital for employees in the UAE.
How To Calculate Leave Salary In UAE

Summary

The calculation of annual leave pay for 2024 in the UAE is subject to the provisions of the UAE Labor Law, which consider the employee’s length of service. Taking 30 days of annual leave after 12 months of employment entitles the employee to their full monthly salary, including basic pay and allowances.

However, when unused annual leave is encashed upon leaving a job, the calculation is based entirely on basic salary. In case of non-compliance by the employer, the employees have the option to lodge a complaint with the MOHRE to seek redressal and redress.

In order to protect their rights and ensure fair treatment, all UAE employees should be well aware of the regulations regarding annual leave and salary calculation in the private sector.

FAQs:

  1. How To Calculate Leave Salary In UAE?

    Leave salary in the UAE is calculated based on the UAE Labor Law, with specific entitlements based on an employee's length of service.

  2. How is leave payment calculated in UAE?

    Leave payment in the UAE is typically your full monthly salary, including the basic salary and allowances, if you've completed 12 months of employment.

  3. What are the leave rules in the UAE?

    Leave rules in the UAE include timely usage, carrying over leave with consent, time limits on unused leave, and the inclusion of official holidays and sick leaves in the duration of annual leave.

  4. How is public holiday pay calculated in UAE?

    Public holiday pay in the UAE is generally calculated as a regular working day's pay, subject to employment terms and company policies.

  5. Is leave salary basic or full salary in UAE?

    Leave salary in the UAE can be the full monthly salary, which includes the basic salary and allowances if you've completed 12 months of employment. However, when claiming encashment of unused leave, it's based solely on the basic salary, excluding additional allowances.

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