Understanding leave salary calculation in UAE is essential for every employee working under the country’s labour laws. Whether you’re taking annual leave or leaving a company, knowing how your leave salary is computed ensures you get what you’re entitled to without confusion.

What is Leave Salary?

Leave salary is the amount you receive during your annual leave period. In the UAE, it is calculated based on your basic salary, excluding allowances such as housing or transportation.

Legal Entitlement

Under the UAE Labour Law (Federal Decree-Law No. 33 of 2021):

• If you’ve worked 6 months to 1 year, you get 2 days of leave per month.

• If you’ve worked more than 1 year, you’re entitled to 30 calendar days per year.

The Formula

The standard formula for leave salary is:
Leave Salary = (Basic Monthly Salary ÷ 30) × Number of Leave Days

Example:
If your basic monthly salary is AED 9,000 and you take 15 days’ leave:
(9,000 ÷ 30) × 15 = AED 4,500

Quick Reference Table

Special Notes

• Public holidays during your leave do not reduce your annual leave balance.

• Unused leave can often be encashed if your company policy allows it.

• Part-time employees receive leave salary proportionally based on hours worked.

Why It Matters

Knowing your leave salary calculation helps you plan your finances, ensures compliance with UAE law, and avoids disputes with your employer. Many modern HR platforms, such as Max HR, allow employees to track leave balances and automate salary calculations for accuracy.

Final Thoughts

If you’re working in the UAE, take the time to understand your rights and the exact calculation method for your leave salary. This knowledge can make a significant difference in ensuring fair treatment and correct payment during your time off.