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Annual Leave Regulations in the UAE: A Comprehensive Guide

DALL·E 2024 01 09 13.57.07 A legal consultation room in the UAE where an employment lawyer of Middle Eastern descent is advising a diverse group of clients including South Asi

In the United Arab Emirates (UAE), the rules regarding the cancellation of annual leave by employers are governed by the Federal Decree-Law No. (33) of 2021 on the Regulation of Employment Relations and its Executive Regulations. These regulations establish clear guidelines to ensure the rights of employees are protected while allowing employers to manage leave schedules effectively.

  1. Employer’s Authority to Determine Leave Dates: Employers have the authority to determine the dates of an employee’s annual leave. This determination is based on various factors, such as work requirements and the need to rotate leave among employees to ensure the smooth functioning of the workplace. However, this must be done in agreement with the employee​​.
  2. Notification of Leave Dates: Once the leave dates are determined, employers are required to notify their employees of these dates at least one month before the commencement of the leave. This requirement is stipulated in clause 4 of Article (29) of the Employment Law​​.
  3. Carrying Forward or Cashing Out Leave: If employees are unable to avail their annual leave within a year, they have the option to either carry forward the leave entitlement to the next year or seek leave pay in lieu of the unused leave. This is outlined in clauses (8) and (9) of Article (29) of the Employment Law​​.
  4. Handling Unilateral Cancellation by Employers: If an employer unilaterally cancels an employee’s pre-approved leave without informing them, the employee should initially request the employer to revoke such cancellation. If this is not feasible due to work exigencies, the employee can either carry forward the entire leave entitlement to the next year or request a cash payment equivalent to the leave entitlement. This payment is calculated based on the employee’s basic salary​​.
  5. Voluntary Non-Utilization of Leave: In cases where employees voluntarily choose not to use their annual leave, they may carry forward only 50% of their annual leave entitlements to the following year, based on an agreement with their employer. This is as per clause 1 of Article (19) of the Executive Regulations​​.
  6. Rights Reservation and Legal Recourse: Employees should inform their employers if their leave is being cancelled unilaterally and not waived voluntarily. If an employer still deprives an employee of their rights in violation of the applicable laws, the employee has the option to approach the UAE’s Ministry of Human Resources and Emiratisation to report the issue​​.

This comprehensive framework ensures a balanced approach, respecting both the operational needs of employers and the legal rights of employees regarding annual leave. It underscores the importance of communication and mutual agreement in the management of leave schedules, providing clear options for recourse in cases of disputes or unilateral decisions.

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