UAE Leave Salary Calculator
Calculate payment for unused annual leave
Standard is 30 days per year
The Complete Guide to UAE Leave Salary Calculation (2026)
In the United Arab Emirates, taking time off to rest is not just a company perk—it is a strict legal entitlement protected by Federal Decree Law No. 33 of 2021. Whether you are actively planning your yearly vacation or preparing to resign and want to cash out your unused days, understanding exactly how your leave salary is calculated is essential.
This authoritative 1,200+ word guide explains everything you need to know about UAE annual leave laws in 2026, including how days are accrued during your probation period, the legal rules surrounding carrying forward unused leave, and precisely how to calculate the monetary value of those days. For a complete view of your final settlement, you should combine these calculations with our End of Service Calculator.
1. Statutory Annual Leave Entitlements in the UAE
How much paid leave you get depends entirely on how long you have worked for your current employer. The UAE Labour Law dictates the absolute minimums, though many multinational companies choose to offer more generous packages.
- Less than 6 Months (Probation): Employees who have not yet completed 6 months of service are legally not entitled to any paid annual leave. Any leave taken during this time is generally unpaid.
- 6 Months to 1 Year: Once you cross the 6-month threshold, you begin to accrue exactly 2 days of paid leave for every month worked.
- More than 1 Year: Upon completing one full year of continuous service, you are entitled to 30 calendar days of paid annual leave per year. Note that this includes weekends and public holidays that fall within your vacation period.
Calendar Days vs. Working Days
A very common point of confusion is whether the 30 days are "working days" (Monday to Friday) or "calendar days." Under UAE law, the standard 30-day entitlement refers to calendar days. If you take a 2-week vacation, it consumes 14 days of your leave balance, not 10.
2. The Rules of Carrying Forward and Cashing Out
Employees often want to save their leave days for a longer trip the following year or cash them out. The 2022/2026 Labour Law updates significantly clarified these rules to protect both employers and employees.
Carrying Forward Leave
You are legally permitted to carry forward up to half (15 days) of your annual leave entitlement to the following year, provided you get agreement from your employer. Employers cannot force you to forfeit your leave entirely; they must either allow you to take it, allow you to carry it forward, or pay you for it.
Cashing Out Leave (Leave Encashment)
Leave encashment happens under two main scenarios:
- During Active Employment: If you and your employer agree, you can choose to work instead of taking your leave and receive a cash payout for those days.
- Upon Resignation/Termination: When your employment contract ends, the employer is legally obligated to pay you for every single day of accrued, unused annual leave. This forms a major part of your final End of Service benefits.
3. The Mathematical Formula: Basic Salary Only
The single most critical rule for calculating leave salary cash-outs is that it is strictly based on your Basic Salary, not your gross salary. Your allowances (housing, transport, etc.) are excluded from this specific calculation.
Formula: (Monthly Basic Salary ÷ 30) × Unused Leave Days
Comparison Table: Resignation vs Termination Payout
To visually understand the difference between resigning and being terminated on a standard unlimited contract, refer to this comparison table based on years of service.
| Years of Service | Resignation — Entitlement | Termination — Entitlement | Formula Base |
|---|---|---|---|
| Less than 1 year | No gratuity | No gratuity | N/A |
| 1 – 3 years | 1/3 of 21 days/year | Full 21 days/year | Basic salary ÷ 30 |
| 3 – 5 years | 2/3 of 21 days/year | Full 21 days/year | Basic salary ÷ 30 |
| 5+ years | Full 30 days/year | Full 30 days/year | Basic salary ÷ 30 |
| Maximum cap | 2 years basic salary | 2 years basic salary | Article 132 |
4. Worked Calculation Examples
To ensure you understand exactly how your employer should be calculating your leave encashment, review these detailed scenarios.
Worked Example 1: Resignation with Unused Leave
Scenario: Employee A earns AED 15,000 gross salary (of which AED 9,000 is basic salary) and resigns after 3 years. They have 12 days of unused annual leave remaining.
- Step 1: Identify the correct salary component. (Basic Salary = AED 9,000)
- Step 2: Calculate the daily basic wage. (AED 9,000 ÷ 30 = AED 300/day)
- Step 3: Multiply the daily wage by the unused days. (AED 300 × 12 days)
- Result: AED 3,600
Worked Example 2: Fractional Leave Accrual (First Year)
Scenario: Employee B earns AED 12,000 gross salary (of which AED 6,000 is basic salary). They pass their probation and resign after exactly 8 months of employment, having taken 0 days of leave.
- Step 1: Determine accrued days. (8 months - 6 months = 2 months eligible for 2 days/month. Total = 4 days accrued)
- Step 2: Calculate the daily basic wage. (AED 6,000 ÷ 30 = AED 200/day)
- Step 3: Multiply daily wage by accrued days. (AED 200 × 4 days)
- Result: AED 800
5. Unpaid Leave and Its Impact on Your Benefits
Taking unpaid leave has a cascading negative effect on your other UAE Labour Law benefits. It is crucial to understand what happens when you take unauthorized or agreed unpaid days off:
- No Salary Accumulation: Obviously, you are not paid your salary for those days.
- Gratuity Reduction: Any days taken as unpaid leave are explicitly subtracted from your total length of service when your final gratuity is calculated.
- No Annual Leave Accrual: You do not accrue your standard annual leave days while you are on an unpaid leave status.
6. Maternity Leave, Sick Leave, and Compassionate Leave
Annual leave is entirely separate from other statutory leave types. Your employer cannot force you to use your annual leave balance if you legally qualify for the following:
- Sick Leave: After probation, employees get 90 days of sick leave per year (15 days fully paid, 30 days half-paid, 45 days unpaid).
- Maternity Leave: Female employees get 60 days of maternity leave (45 days fully paid, 15 days half-paid).
- Compassionate Leave: 5 paid days in the event of the death of a spouse, and 3 paid days for a parent, child, or sibling.
Official Legal References
This calculator strictly follows the latest 2026 directives from the UAE government. For official documentation, please refer to:
- Official MOHRE Portal
- Federal Decree Law No. 33 of 2021: On the Regulation of Labour Relations in the Private Sector (specifically Articles 29, 31, and 32).
Disclaimer: This is an estimate. Check your employment contract and company policy for exact leave entitlements.