Unpaid Leave Under UAE Labour Law

Unpaid leave has become increasingly important nowadays, especially in modern employment relationships between employers and employees. Employees have the right to request unpaid leave if they need it. It is an important subject for the approval of the employer. Unpaid leave is not an automatic entitlement except in limited situations, which are defined in law and can be consulted with expert lawyers.

UAE Labour Law allows employees to have unpaid leave, which is allowed by the UAE federal labour law. For example, they can have emergencies, personal matters, family matters, health-related issues, education matters, etc. Federal UAE Law No 33 of 2021 regulates the employee-employer relationship. This federal law sheds light on the employer-employee relationship. This federal law provides legal guidance about the employer-employee relationship, its implementations, and consequences.  Let us have a comprehensive, detailed understanding of this.

Unpaid leave is defined as a temporary absence from work. It should not be mixed with paid leaves e.g., annual leaves, sick leaves, maternity leaves, paternity leaves, etc. Employees are not entitled to receive any salary or benefits. By law, it is not an automatic statutory entitlement; it means the employee does not have a legal right to be paid if he is on leave, under the UAE Labour Law.

Employers have no right by law to put the employees on unpaid leave from their side (unilaterally). It is recommended that there be a mutual understanding between the employer and employee. Modern legislation enables employees working in the private sector to have flexible work hours, work from home options, and increased leave support. The jurisdiction at DIFC and ADGM can be different. It is better to check with professional labour and employment lawyers regarding this.

Article 33 of Federal Law 33 of 2021 tells us about the unpaid leaves and their criteria. It tells us that unpaid leave is excluded from paid leave. It has effects on the end-of-service gratuity calculation and other employment benefits. Basically, Article 33 clarifies that periods of unpaid leave are generally excluded from the calculation of continuous service, including EOS gratuity.

It means that if an employee takes unpaid leave for several months, then those months cannot be considered or counted in total gratuity calculations unless there is a separate engagement or settlement between both parties. The law also emphasizes transparency. The law states that any unpaid leave consensus/arrangement should be documented in writing, which should be signed by both parties. It should specify very clearly about total leave duration, benefits during the vacation, impact on gratuity, obligations during the leaves and after the leave, or any extra working hours. Law only allows a consensus between two parties. Any pressure or coercion can lead the matter to MOHRE, where employees can lodge the complaint against the employer.

Muslim employees have right to take Hajj leaves, once during the employment contract. Employees can take 30 days unpaid leave to perform the Hajj pilgrimage. These leaves are separate from annual paid leaves. Employees must provide the advance information to employers for work management. 30 days of unpaid leave for Hajj are the right of Muslim employees.

Under UAE Labour Law, eligible employees have right to take sick leave up to 90 days, annually. Employees have to finish the probation first, because it is not allowed on probation. The details are as follows:

• First 15 Days: Employee receives full salary.
• Next 30 Days: Employee receives half salary.
• Remaining 45 Days: Unpaid Leaves. Employee receives no salary.

Employees are required to arrange medical certificates from approved healthcare providers/hospitals/clinics and submit to employers.

UAE Labour Law also allows the female employees, to get maternity leaves. However, extended maternity leaves (unpaid) are also granted to female employees if the medical condition is not stable or serious. 45 extended unpaid maternity leaves, are offered by UAE Labour Law to female employees. Further details are available in our website. Our legal experts can also be consulted for this topic.

There is no formal definition of “Emergency Leave”, provided by UAE Labour Law. However, employers can get unpaid leaves for:

• Family/Domestic Emergency
• Personal Matters/Crises
• Education Matters
• Immigration/Residence Matters

Generally, employers cannot force employees to take unpaid leave unless there is written consent between both parties. However, the law recommends that any consensus like this must be around a reasonable duration and in compliance with UAE rules and regulations.

If employees refuse the idea of unpaid leave, then by law, employers cannot stop paying their salaries. As we said above, employees have the right to lodge complaints in MOHRE otherwise.

Health insurance cannot be stopped during the unpaid leaves. Health support is the primary right of employees in the UAE. Therefore, during the unpaid leave, the employer cannot stop the health insurance support for the employee who is on unpaid leave.

End-of-service gratuity is a right for employees as per the UAE Labour Law. However, If an employee works for 11 years but spends 1 month on unpaid leave, then gratuity will be calculated on 10 years and 11 months instead of the full 11 years.

• Expert suggests that the safest approach is always to have a written consensus. It means verbal consensus has no authority or value. A properly drafted written agreement is good for both parties, employers, and employees. If the agreement also contains some other points, then it’s better if drafted by legal experts.
• Employers should make sure that unpaid leave arrangements comply with Federal Decree Laws.