Questions & Answers
Calculation of the leave salary entitlements post termination
I have been working for 1 year & 8 months on an unlimited contract basis. I have been made terminated from service (due to low business).
I have used only 21 days of leave so far from the 1st year & could not use the rest as the management did not approve the same.
When the annual leave is availed, the company pays the employees the basic + allowances in full as per normal salary. But the company policy is silent when it comes to payment of unused leave in the circumstance of termination.
They have advised that only basic wage will be paid for unused leave & only for the 2nd year (as the company has no carryover policy). Could you kindly advise what is the correct method of calculation?
As per the UAE labour law, in some cases it is mentioned that you can encash up to 2 years leave calculated on basis of basic salary + allowances are to be paid for the unused leave in case of termination.
Kind regards,
M.
Dear Malcolm,
Thank you for getting in touch with me on this.
I believe we have spoken before, but for the sake of public understanding, I reiterate that as per the Dubai Court of Cassation judgement in Case No.108/2009, an employee upon termination is entitled only to the basic salary.
Further, you can claim for unused salary for up to 2 years (quoted in the judgement).
You can directly contact the Ministry of Labour to clarify on the same and raise a dispute.
I trust you will find this helpful.
Regards,
Hari Wadhwana
