Annual leave is one of the most misunderstood rights in the UAE workplace. Every year, thousands of employees lose leave days they could have carried forward, accept encashment paid at the wrong rate, or resign without claiming the unused leave sitting in their balance. Others clash with their employer over when leave can be taken — and who gets to decide.
This guide explains UAE annual leave rules for 2026 exactly as the law states them: how many days you are entitled to, what happens to unused days, when your employer can refuse a leave request, what leave payout you get if you resign, and the seven mistakes that cost employees money every year. Every rule below is tied to the actual legal provision — Federal Decree-Law No. 33 of 2021 on the Regulation of Employment Relations and its implementing Cabinet Resolution No. 1 of 2022 — with plain-English explanations of what each rule means for you.
How Much Annual Leave Are UAE Employees Entitled To?
The headline number is simple: 30 days of paid annual leave per year. That figure comes from Article 29(1) of Federal Decree-Law No. 33 of 2021, which sets the minimum entitlement for private-sector employees across the UAE. But the entitlement is not identical for everyone — it depends on how long you have worked for your employer. Here is the full breakdown:
| Length of service | Annual leave entitlement | Legal basis |
|---|---|---|
| Completed 1 full year of service | 30 days of paid annual leave per year | Article 29(1)(a) |
| More than 6 months but less than 1 year | 2 days per month worked (e.g. 9 months = 18 days) | Article 29(1)(b) |
| 6 months or less | None yet — leave rights begin after 6 months | Article 29(1) |
| Employment ends mid-year | Proportionate leave for the part of the final year worked | Article 29(1)(c) |
A few clarifications matter here. First, the 30 days are calendar days, not working days — they include weekends that fall inside your leave period. Second, "not less than 30 days" is a floor, not a ceiling: your employer or contract can give you more, and many UAE companies do. Third, if you have worked 8 months and take 16 days, those days come out of your proportional entitlement (8 × 2 = 16 days).
For the full picture of your statutory rights — leave, gratuity, working hours and more — see our complete UAE Labour Law 2026 guide.
Is Annual Leave Paid? Which Salary Is Used?
Yes — annual leave is leave with full wage, which means you continue to receive your normal salary (basic salary plus the allowances you normally receive) while you are on leave. The law phrases it as annual leave "with full wage", and in practice that means your pay continues uninterrupted during the 30 days.
There is one important distinction to keep straight, because it affects cash payouts:
- Taking the leave — you are paid your normal full salary while on leave.
- Being paid in lieu of leave (encashment or final-settlement payout) — the calculation uses your basic salary only, not total salary. Allowances on top of basic salary are excluded. This comes from Article 19 of Cabinet Resolution No. 1 of 2022, and it applies whether you are encashing leave during employment or being paid out when you resign.
This basic-salary rule is the single most common source of disputes: employees expect the payout to match a full month's salary and are surprised when allowances are excluded. If you are checking what is actually recorded as your basic salary versus allowances, start with how to check your UAE labour contract online — your MOHRE-registered contract shows the split.
Can You Carry Forward Unused Annual Leave?
Yes — within limits. Under Article 19(1) of Cabinet Resolution No. 1 of 2022, you may carry forward not more than half of your annual leave to the following year — in practice, up to 15 days of the standard 30-day entitlement. The same article gives you the alternative of agreeing with your employer to take a cash allowance instead, calculated on the wage you were receiving when the leave fell due.
Three conditions attach to this:
- It is not automatic. Carry-forward and cash-in-lieu while still employed are both subject to agreement with your employer (and your establishment's bylaws). Your employer can propose the carry-over; you can propose encashment — neither side can force the other outside the legal framework.
- Your employer cannot block you forever. Under Article 29(8) of the Labour Law, an employer may not prevent you from using your accrued annual leave for more than two consecutive years — unless you are the one choosing to carry it forward or take cash in lieu. If your company refuses to schedule leave for over two years, that is a legal problem for the company, not for you.
- Leave should normally be used in the year it falls due. The law's general principle is that you use your leave in the entitlement year; carry-forward is the exception, capped at half.
In February 2026, MOHRE restated these conditions publicly: unused leave may be carried forward with the employer's approval, payment for carried-over leave is calculated on basic salary, and employers may not prevent workers from taking leave for more than two consecutive years.
Can You Get Paid Instead of Taking Leave (Encashment)?
Encashment — receiving cash in lieu of actually taking the days off — is possible by mutual agreement with your employer, per Article 19(1) of the implementing regulations quoted above. There is no automatic legal right to demand encashment of unused days while you remain employed; your employer has to agree.
The practical pattern in the UAE is this: some companies routinely encash carried-forward balances at year end, some refuse and insist you take the days, and many do nothing — letting balances quietly expire. What the law does not allow is an employer simply deleting your earned balance: your options are take it, carry forward up to half, or agree cash with the employer. If your company has a written leave-encashment policy, it should be stated in your contract or staff handbook — verify your offer letter and labour contract to see exactly what was promised.
And remember the calculation: encashment uses basic salary, not your total monthly package.
What Happens to Unused Leave When You Resign or Are Terminated?
This is where the law is unambiguous and generous. Under Article 19(2) of Cabinet Resolution No. 1 of 2022: if your service ends, you shall be paid a cash allowance for the balance of your legally due annual leave, according to your basic salary. This applies whether you resign, are terminated, or your fixed-term contract expires.
The payout covers:
- Leave you earned in complete years but never took (subject to the carry-forward rules that applied while you were employed), and
- Proportionate leave for your final, incomplete year — Article 29(1)(c) expressly covers "a leave for parts of the last year he spent at work if his service is ended before using his annual leave balance". Worked 5 months of your final year? You are owed roughly 5 months' worth of accrued leave, paid out.
Worked example: an employee with a basic salary of AED 4,000, two full years of untaken (carried-forward) balance of 15 days, plus 6 months of the final year accrued (12.5 days at 2.08 days/month), would be owed roughly 27.5 days at the daily rate of basic salary ÷ 30 — about AED 3,667. The exact balance depends on your company's leave records, which is why keeping your own log of leave taken matters.
This payout forms part of your end-of-service settlement, which should also include gratuity and any notice-period dues. See UAE gratuity after resignation for the other half of the settlement calculation.
Who Decides When You Take Annual Leave?
Your employer does — but not arbitrarily. Article 29(4) of the Labour Law sets a balanced process:
- The general rule is that you use your leave in the year of entitlement.
- The employer may fix the dates of leave according to work requirements, in agreement with you, or rotate leave among employees to keep work running smoothly.
- The employer must notify you of your leave dates at least one month in advance.
In practice this means your employer can decline a specific leave request for genuine operational reasons and propose alternative dates — but it cannot indefinitely refuse to schedule your leave at all (see the two-year rule above). If your employer is blocking leave requests entirely, that can form the basis of a labour complaint — our step-by-step guide to filing a MOHRE complaint covers the channels.
Do Public Holidays During Annual Leave Count?
Yes — public holidays or other legally mandated leave falling inside your annual leave period are counted as part of the annual leave, unless your employment contract or company regulations give you more favourable terms. This is MOHRE's stated position and it catches many employees by surprise: if Eid falls in the middle of your 30 days, those days are still annual-leave days, not extra days off.
If your contract says otherwise — some employers grant holidays on top of annual leave — the contract's better terms apply. Another reason to read the contract, not assume.
Annual Leave During Probation
You accrue annual leave from your first day, but the legal entitlement to take it begins after six months of service (the 2-days-per-month rule for months 6–12). During probation — which can last up to 6 months — most employees therefore cannot yet take paid annual leave, although accrued days are banked for later. If you leave during probation, the proportionate payout rules still apply to what you accrued. For everything probation-related, see UAE probation period rules 2026.
Part-Time Employees and Annual Leave
Part-time employees are entitled to annual leave too — in proportion to their actual working hours, as specified in their employment contract and the executive regulations. If you work half the hours of a full-time colleague, your leave entitlement scales accordingly. The same carry-forward and payout principles apply to the pro-rated balance.
The Air-Ticket Myth: Does Your Employer Owe You a Yearly Flight?
One of the most common beliefs among UAE expatriates is that the employer must provide an annual air ticket home. The law says otherwise: Federal Decree-Law No. 33 of 2021 is silent on annual air tickets. What the law mandates is a repatriation ticket at the end of employment — under Article 13(12), the employer bears the cost of repatriating you to your point of hire when the contract ends (unless you join another employer, in which case the new employer bears it, or the termination is for reasons attributable to you).
Annual tickets are therefore purely contractual: if your offer letter or contract promises a yearly ticket or ticket allowance, the employer must honour it — but the law itself does not create the obligation. When verifying your job offer, the ticket clause is one of the benefits worth checking word by word.
What If You Don't Return After Your Leave Ends?
Extending your leave without approval has sharp consequences:
- Under Article 34, if you do not return directly to work after your leave without a legitimate reason, you are not entitled to wages for the absence period.
- Under Article 44(8), the employer may terminate you without notice (after a written investigation, with a written and reasoned decision) if you are absent without an acceptable reason for more than 7 consecutive days or more than 20 non-continuous days in a year.
If you genuinely cannot return — a family emergency, a medical situation — document it and communicate with your employer before the leave expires. Valid evidence can turn an unauthorised absence into an approved extension. Without it, you risk both salary and your job.
Annual Leave and the Notice Period
Two rules protect employees around termination:
- Notice cannot run during your leave. Under Article 35, if either party terminates the contract while you are on leave, the notice period begins only from the day after your scheduled return — your employer cannot count your holiday as your notice period unless you both agree otherwise.
- Job-search day. If your employer terminates the contract, Article 43(5) gives you the right to be absent one working day per week, without pay, during the notice period to look for another job (you choose the day, with at least 3 days' notice to the employer). Unused annual leave at the end is paid out in your settlement regardless.
For the full resignation and termination playbook, read UAE notice period rules 2026.
7 Mistakes That Cost UAE Employees Their Annual Leave
- Assuming leave days never expire. The carry-forward cap is half your entitlement — anything above that, not taken and not encashed by agreement, can be lost. Check your balance before year end.
- Expecting encashment at full salary. Payouts use basic salary. If allowances are half your package, the cash number will surprise you — plan on the basic-salary figure.
- Resigning without claiming the balance. Every resignation settlement should include the proportionate leave payout. Ask for the breakdown in writing.
- Not keeping a leave log. Company HR systems make errors. Keep your own record of leave requested, approved and taken.
- Extending leave without written approval. A verbal "okay" from a manager is not protection. Get extensions approved in writing — 7 unapproved days can end your employment.
- Assuming the air ticket is a legal right. If it matters to you, get the annual ticket clause written into the contract before you sign.
- Letting leave pile up for years. Your employer cannot legally block you for more than two years — if scheduling is being stonewalled, escalate early rather than watching the balance die.
Annual Leave vs Other Leave Types — Quick Comparison
| Leave type | Entitlement (private sector) | Pay basis |
|---|---|---|
| Annual leave | 30 days/year (2 days/month for 6–12 months) | Full wage; payout at basic salary |
| Sick leave | 90 days/year (15 full / 30 half / 45 unpaid) | Graduated |
| Maternity leave | 60 days (45 full / 15 half) | Full pay |
| Parental leave | 5 working days (within 6 months of birth) | Full pay |
| Public holidays | As declared by Cabinet each year | Full pay |
Frequently Asked Questions
How many annual leave days do I get in the UAE?
30 days of paid annual leave per year after completing one year of service; 2 days per month if you have worked more than 6 months but less than a year. The entitlement is set by Article 29 of Federal Decree-Law No. 33 of 2021.
Can I carry forward unused annual leave to next year?
Yes — up to half of your annual leave (15 days of the standard 30-day entitlement) can be carried forward under Article 19 of Cabinet Resolution No. 1 of 2022, or you can agree with your employer to take cash in lieu.
Do I get paid for unused annual leave if I resign?
Yes. When your service ends, you must be paid a cash allowance for your full legally due leave balance — including proportionate leave for your final partial year — calculated on your basic salary.
Is annual leave encashment calculated on basic or gross salary?
Basic salary. Article 19 of the implementing regulations specifies cash allowances for unused leave are calculated on basic salary; allowances are excluded.
Can my employer refuse my annual leave request?
Your employer can set leave dates based on work requirements, in agreement with you, and must give at least one month's notice of the dates. But it cannot prevent you from using accrued leave for more than two consecutive years.
Does my employer have to give me an annual air ticket?
No — UAE labour law does not require an annual air ticket. It only mandates a repatriation ticket when your employment ends (Article 13(12)). Annual tickets are purely a matter of what your contract promises.
What happens if I don't return after my annual leave?
You lose wages for the absence period (Article 34), and if the unauthorised absence exceeds 7 consecutive days or 20 non-continuous days in a year, your employer can terminate you without notice after a written investigation (Article 44(8)).
Can my notice period run while I am on annual leave?
No. Under Article 35, the notice period only begins the day after your scheduled return from leave, unless you and your employer agree otherwise.
Do public holidays count as annual leave days?
Yes — public holidays falling inside your annual leave are counted as part of it, unless your contract or company policy gives you more favourable terms.
Do part-time employees get annual leave in the UAE?
Yes, in proportion to their actual working hours, as set out in their employment contract and the executive regulations.
Sources & Legal Basis
This guide is based on: Federal Decree-Law No. 33 of 2021 on the Regulation of Employment Relations (Articles 29, 34, 35, 43, 44, and 13(12)); Cabinet Resolution No. 1 of 2022 on the Implementation of Federal Decree-Law No. 33 of 2021 (Article 19); and MOHRE's February 2026 clarification on annual-leave carry-forward conditions. Laws change — if you are in an active dispute, confirm the current text with MOHRE (80060) or a licensed legal adviser before acting.
Related guides: UAE Labour Law 2026 complete guide · Probation period rules · Notice period rules · WPS salary-delay rights · Overtime pay calculation
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