Is the unused annual leave balance paid based on full or basic salary upon leaving job?

Greetings,

According to the UAE labor law, any unused annual leave balance paid upon completing 2 years of work and leaving the company (resignation, termination without cause, or employee's death) is calculated based on the basic salary and fixed allowances only, not the full salary.

This is in line with Article 29(9) of Federal Decree-Law No. 33 of 2021 on the Regulation of Employment Relations, which states:

"The worker shall be entitled to a cash allowance for the balance of his legally due annual leave, according to the basic salary."

It's important to note that:

While the payment is based on the basic salary, it still includes any fixed allowances included in your contract.

This applies when your employment ends, not just if you choose not to take your leave within two years.

You are still entitled to take your full annual leave within its validity period, even if it's two years or more after accrual.

For further inquiries about your topic, you can reach our office or contact us on WhatsApp.

Dear questioner

Remuneration for the balance of annual leave shall be calculated in basic salary.

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Dear questioner,

Full salary, as per UAE's Labor Law.

Please note that if you continue working for the same employer and do not get your annual balance payment, then you can only claim - in front of the labor court - your annual leave balance for the last 2 years only.

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