UAE: Can Employees' Salaries, Allowances Be Deducted During Annual Leave?

Question: I work in a mainland Dubai company. I will be going on my annual leave later this year, and my company has something called 'leave salary'. I don't understand the concept. Can you explain it to me, please? Is the company legally required to pay me my full salary while I am on leave? Can they deduct any monthly allowances I receive?

Answer: In the UAE, employees are entitled to at least 30 days of paid annual leave every year, which must be paid at their full salary.

This is in accordance with Article 29(1)(a) of the Federal Decree Law No. 33 of 2021 on the Regulation of Employment Relations, which states, "Without prejudice to the employee's acquired rights for the period preceding the date of enforcement of the provisions of this Decree-Law, the employee shall be entitled to an annual leave with full salary, of not less than thirty days for each year of extended service.”

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Furthermore, an employee is entitled to receive the salary for the entire duration of an annual leave. This is in accordance with Article 29(6) of the Employment Law,“The employee shall be entitled to the salary for the period of his annual leave.”

In addition, salary refers to an employee's basic salary and includes any regular allowances or benefits (cash or in-kind) provided under the employment contract or the establishment's bylaws. This is in accordance with Article 1 of the Employment Law,

“The basic salary, in addition to the cash allowances and benefits in-kind allocated to the employee under the employment contract or this Decree-Law, and which may include: benefits in-kind that the employer shall grant to the employee or their cash equivalent, if allocated as part of the salary in the employment contract or the establishment's by-laws; the allowances that the employee is entitled to obtain in return for his effort, the risks he is exposed to while performing his work or for any other reasons; or the allowances granted to meet the cost of living, a percentage of sales, or a percentage of the profits paid for what the employee markets, produces or collects.”

In accordance with the aforementioned provisions, it may be understood that during your annual leave, you are entitled to receive your full salary, which may include both the basic salary and the regular allowances provided to you as per your employment contract.

Ashish Mehta is the founder and Managing Partner of Ashish Mehta & Associates. He is qualified to practise law in Dubai, the United Kingdom and India. Full details of his firm on: Readers may e-mail their questions to: ... or send them to Legal View, Khaleej Times, PO Box 11243, Dubai.

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