Annual Leave Entitlement in UAE Labor Law (2026)

UAE workers get 30 days of paid leave. Federal Decree-Law No. 33 of 2021 (the UAE Labor Law) guarantees every full-time private sector employee a minimum of 30 calendar days of annual leave after completing one year of service. Part-time workers, probationary employees, and those with less than one year all have different entitlements. Despite the clear legal framework, leave disputes remain among the most common labor complaints — employers denying leave, refusing cash-in-lieu on termination, or calculating entitlements incorrectly. This guide covers every rule governing annual leave, your rights when leave is denied, and what happens to your balance when you leave. For broader labor law guidance, see our complete guide to labor lawyers in UAE.

What Is Annual Leave Under UAE Labor Law?

Annual leave under UAE Federal Decree-Law No. 33 of 2021 is a mandatory paid absence from work — 30 calendar days per year for employees with 1+ year of service, or 2 days per month for those with less than a year — during which the employer must pay the employee's full basic salary plus housing allowance, and which cannot be waived, reduced, or traded for money during employment.

Article 29 of the Labor Law establishes the minimum annual leave entitlements:

• Less than 6 months of service: No annual leave entitlement (but see accrual below)
• 6 months to 1 year: 2 days per month (prorated)
• 1 year or more: 30 calendar days per year

Key principles:

• Leave accrues from the first day of employment
• Fridays, Saturdays (weekends), and public holidays falling within the leave period do not count against the leave balance
• The employer determines when leave is taken based on business needs, but cannot refuse leave indefinitely
• The employee receives full pay during leave (basic salary + housing allowance at minimum)
• Leave cannot be substituted with cash payment during employment (except on termination)

The law sets a floor, not a ceiling. Employment contracts can provide more generous leave — many UAE employers offer 22-25 working days (which, when weekends are excluded, roughly equals or exceeds 30 calendar days).

How Is Annual Leave Calculated?

Annual leave is calculated based on calendar days (not working days) under the UAE Labor Law — 30 calendar days per year means approximately 22 working days when weekends are excluded — with leave accruing monthly at 2.5 days per month, pro-rated for partial years, and weekend days falling within the leave period added on top of the 30-day entitlement.

Leave Calculation Examples

What Counts as a "Day" of Leave?

This is where confusion arises. The law specifies 30 calendar days, which includes weekends. However, Article 29(6) states that official holidays and rest days falling within the leave period are not counted as leave days.

Practical example: An employee takes 2 weeks of annual leave starting Monday.

This means 30 calendar days of leave effectively provides approximately 22 working days off (assuming a Mon-Fri work week) — a generous entitlement by global standards.

Part-Time Employees

Federal Decree-Law No. 33 of 2021 introduced formal part-time employment for the first time. Part-time employees' annual leave is calculated proportionally based on their working hours relative to full-time hours, as specified in their employment contract. MOHRE's implementing regulations provide further guidance.

When Can You Take Annual Leave?

The employer sets the annual leave schedule based on business needs, but they must allow the employee to take at least one continuous period of leave not less than 10 days — the employee can request specific dates, and while the employer can refuse based on legitimate business reasons, they cannot deny leave entirely or repeatedly defer it beyond the year in which it accrues.

Employer vs. Employee Rights

Leave During Probation

Employees on probation (maximum 6 months under the new law) are generally not entitled to take annual leave. However, leave accrues during probation and becomes available either:

• Upon successful completion of probation, or
• As cash-in-lieu if the employment ends during probation

Some employers allow probation leave as a goodwill measure, but it is not legally required.

Leave During Notice Period

An employee serving their notice period can use accrued annual leave during notice, but only with the employer's agreement. The employer can require the employee to work through the notice period and receive cash-in-lieu for unused leave instead.

Can You Carry Over Unused Leave?

The UAE Labor Law requires employees to take their annual leave within the year it accrues — employers must allow leave to be taken, and any untaken leave should carry over to the next year, though the law does not explicitly cap carry-over — in practice, MOHRE encourages employers to ensure leave is used within 2 years, and most company policies limit carry-over to 5-15 days.

Article 29(3) states that the employer may determine the dates of annual leave and may divide it into two or more periods. The implication is that the employer is responsible for ensuring leave is taken.

Common Company Policies

Courts have ruled that "use it or lose it" policies that result in employees losing accrued leave are void. If the employer prevents the employee from taking leave (through workload pressure, denial of requests, or understaffing), the employee retains the right to those days — either as time off or cash-in-lieu on termination.

Best Practice

Employees should:

• Submit leave requests in writing (email is sufficient)
• Keep records of denied requests
• Use accrued leave regularly rather than banking large balances
• Request written confirmation of leave balances annually

Employers should:

• Track leave balances monthly
• Proactively schedule leave for employees who have not requested any
• Maintain clear carry-over policies in the employee handbook
• Budget for leave liability in financial statements

How Do Public Holidays Interact With Annual Leave?

UAE public holidays — currently 14 days per year including New Year, Eid Al Fitr (3-4 days), Eid Al Adha (3-4 days), Arafat Day, Islamic New Year, Prophet's Birthday, and Commemoration/National Day — are separate from annual leave, fully paid, and if a public holiday falls during annual leave it is not deducted from the leave balance.

UAE Public Holidays (2026)

If an employee works on a public holiday, they are entitled to either:

• A substitute day off, OR
• 150% of their daily wage (50% premium)

This is separate from overtime rules, which apply to work beyond normal working hours on regular days.

What Happens to Unused Leave When You Leave?

When employment ends — whether by resignation, termination, or contract expiry — the employee is entitled to cash payment for all accrued unused annual leave at their last basic salary rate plus housing allowance, calculated proportionally for partial years, and this payment must be included in the final settlement within 14 days of the last working day.

Cash-in-Lieu Calculation

The formula is straightforward:

Cash-in-lieu = (Basic salary + housing allowance) ÷ 30 × unused leave days

Example: Employee with AED 15,000 basic salary + AED 5,000 housing allowance, and 22 unused leave days:

• Daily rate: (15,000 + 5,000) ÷ 30 = AED 666.67
• Cash-in-lieu: 666.67 × 22 = AED 14,666.67

Important Rules

Key point: even employees dismissed for gross misconduct under Article 44 retain the right to cash-in-lieu for unused annual leave. The right to leave is a statutory entitlement that survives termination for cause.

When Employers Refuse to Pay

If the employer refuses to include leave cash-in-lieu in the final settlement:

1. File a complaint with MOHRE through the app or service center
2. MOHRE mediates within 14 days
3. If unresolved, the case is referred to the labor court
4. Court fees are waived for workers earning below AED 16,000/month
5. The court can order payment plus compensation for delay

How Does Sick Leave Affect Annual Leave?

Sick leave and annual leave are separate entitlements under UAE law — an employee who falls ill during annual leave can convert the sick days to sick leave (with a medical certificate), preserving the annual leave balance — and the employer cannot deduct annual leave days for sick absences, though sick leave pay decreases from full pay (first 15 days) to half pay (next 30 days) to unpaid (remaining 15 days).

Sick Leave Entitlement (Separate from Annual Leave)

If you fall ill during annual leave:

1. Obtain a medical certificate from a UAE-licensed doctor
2. Notify your employer immediately
3. The sick days are converted from annual leave to sick leave
4. Your annual leave balance is restored for those days
5. The remaining annual leave can be rescheduled

The employer cannot force you to use annual leave instead of sick leave, and cannot refuse to convert if you provide a valid medical certificate.

Keep Reading

• Overtime Laws in UAE — When and How Much
• Employment Contract Types in UAE
• Notice Period Rules in UAE — What You Must Know
• Complete Guide to Labor Lawyers in UAE

Frequently Asked Questions

Can my employer deny my annual leave request?

Your employer can postpone your leave to a different date for legitimate business reasons, but cannot deny leave entirely. The law requires that you take at least 10 consecutive days of leave per year. If your employer repeatedly refuses leave requests, file a complaint with MOHRE. Document all denied requests in writing.

Do I get leave pay in advance before going on vacation?

Yes. Article 29(4) of the Labor Law states that the employee is entitled to receive their leave salary before taking the leave. The advance pay covers the period of absence so the employee is not left without income during vacation. Many employers process this through the regular payroll cycle.

What happens if I resign without using any leave?

You receive cash-in-lieu for all accrued unused leave as part of your final settlement. If you worked for 2 years and never took any leave, you would be entitled to 60 calendar days of leave pay. The employer must include this in the final settlement paid within 14 days of your last working day.

Are religious holidays included in the 30 days of annual leave?

No. Public holidays (including Eid Al Fitr, Eid Al Adha, and other religious holidays) are separate from annual leave. If a public holiday falls during your annual leave period, that day is not counted as a leave day — your leave is effectively extended by one day. This applies to all employees regardless of their religion.

Can I take annual leave during my notice period?

Only with your employer's agreement. The employer can require you to work through the notice period and receive cash-in-lieu for unused leave instead. If the employer initiates the termination and places you on garden leave during notice, annual leave is typically consumed during this period unless the contract states otherwise.

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