Annual Leave Under UAE Labour Law: A Complete Guide for Employers and Employees.

Leave entitlements are among the most frequently misunderstood — and most frequently disputed — areas of UAE employment law. Federal Decree-Law No. 33 of 2021 on the Regulation of Employment Relationships, which came into force on 2 February 2022, replaced the previous Federal Law No. 8 of 1980 and introduced significant changes to leave provisions. The Executive Regulations under Cabinet Resolution No. 1 of 2022 provide additional detail. This guide consolidates every type of leave entitlement for private sector employees.

Annual Leave: Article 29 of Federal Decree-Law No. 33 of 2021

The foundational entitlement is annual leave. Under Article 29, an employee who has completed one year of service with the employer is entitled to 30 calendar days of fully paid annual leave. An employee who has completed six months but less than one year of service is entitled to two days of leave per month. Employees who have not yet completed six months are not entitled to annual leave, though employers may grant leave at their discretion.

The annual leave salary is calculated based on the employee's last basic salary, plus housing and transportation allowances if these form part of the regular compensation package. The employer must pay the annual leave salary before the employee begins the leave period.

Key rules governing annual leave include: the employer may determine the dates of annual leave based on operational requirements, but must notify the employee at least one month in advance. If an employee is required to work during a period of annual leave, the employee is entitled to the basic daily wage plus 50% of that amount for each day worked, plus the right to take the leave at another time. The employer may not prevent an employee from taking accrued annual leave for more than two consecutive years. Annual leave includes any public holidays that fall within the leave period.

Carry-Forward and Cash-Out Rules

Article 19(1) of Cabinet Resolution No. 1 of 2022 permits an employee to carry forward up to half of the annual leave balance to the following year, subject to agreement with the employer. Alternatively, the employee and employer may agree to pay the employee in lieu of the carried-forward leave, calculated based on the wage at the time the leave entitlement arose. Upon termination of employment, the employee is entitled to payment for any accrued but unused annual leave, calculated on the basis of the basic salary only (excluding allowances).

Probation Period and Annual Leave

Employees during the probation period — which cannot exceed six months under the law — are not entitled to annual leave as of right. However, an employer may agree to grant leave during probation at its discretion. If the employee completes the probation period and continues in employment, the probation period counts toward the qualifying period for annual leave calculation.

Sick Leave: Article 31 of Federal Decree-Law No. 33 of 2021

An employee who has completed the probation period is entitled to sick leave of up to 90 days per year, which may be consecutive or intermittent. The entitlement is structured in three tiers: the first 15 days at full pay, the next 30 days at half pay, and the remaining 45 days without pay. The employee must notify the employer of the illness within three working days and provide a medical certificate from a licensed medical facility.

An employer may not terminate an employee for reason of illness during the 90-day sick leave period. However, if the employee exhausts the full 90 days and is unable to return to work, the employer may terminate the contract in accordance with the provisions of the law. Sick leave may not be used during the probation period — an employee who falls ill during probation may have the probation period extended by the duration of the absence.

Maternity Leave: Article 30

Female employees are entitled to maternity leave of 60 days, structured as follows: the first 45 days at full pay, and the remaining 15 days at half pay. This entitlement applies regardless of the employee's length of service. After the maternity leave period, the employee may take an additional 45 days of unpaid leave if she suffers from illness related to pregnancy or childbirth, supported by a medical certificate. Additionally, for 18 months following the date of delivery, a working mother is entitled to one or two daily nursing breaks (totalling one hour per day) to nurse her child — these breaks are treated as paid working hours.

Paternity Leave

Federal Decree-Law No. 33 of 2021 introduced paternity leave for private sector employees — a significant addition not available under the previous law. Male employees are entitled to five working days of paternity leave, to be taken continuously or intermittently within the first six months following the birth of the child. This leave is fully paid.

Bereavement Leave

Employees are entitled to bereavement leave in the event of the death of a family member: five working days in the case of the death of a spouse, and three working days in the case of the death of a parent, child, sibling, grandchild, or grandparent. Bereavement leave is fully paid.

Study Leave

An employee who has completed two or more years of continuous service with the employer is entitled to study leave of 10 working days per year, provided the employee is enrolled at an accredited educational institution within the UAE. Study leave is unpaid unless the employer agrees otherwise. The employer may request evidence of enrolment and exam schedules.

Hajj Leave

An employee who has completed one year of continuous service is entitled to leave for Hajj pilgrimage once during the employment relationship. Hajj leave is for a period not exceeding 30 days and is unpaid unless the employer agrees to pay.

Public Holidays

Under the law and Cabinet decisions, employees in the private sector are entitled to paid leave on official public holidays, which include: Gregorian New Year (1 January), Eid Al Fitr (approximately 3.5 days), Arafat Day and Eid Al Adha (approximately 3 days), Islamic New Year (1 day), Prophet Mohammed's Birthday (1 day), Commemoration Day (30 November), and National Day (2–3 December). If an employee is required to work on a public holiday, the employee is entitled to an additional day off or to the basic daily wage plus 50%.

Practical Considerations for Employers

Leave management is a frequent source of employment disputes in the UAE. Employers should implement clear, written leave policies that align with the statutory minimums. Common errors include: calculating annual leave salary based on basic salary only (it should include housing and transport allowances for ongoing leave, though termination payment is basic salary only); failing to pay leave salary before the leave commences; refusing to allow carry-forward of leave balances; and not maintaining accurate leave records for MoHRE inspection purposes.

For employers managing cross-border workforces, it is important to note that the UAE Labour Law applies to all private sector employees working within the UAE, regardless of nationality. However, employees in the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) are subject to separate employment legislation with different leave entitlements.

GSDA Legal Consultants advises employers and employees across the UAE on all aspects of labour law compliance, including leave entitlements, employment contract drafting, workplace policies, and dispute resolution before MoHRE and the UAE courts. Contact our Dubai or Abu Dhabi team for employment law guidance.