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What your untaken annual leave is worth at the end of service — including how many days you have actually accrued.
Leave encashment on termination is paid on basic salary under Article 29 of Federal Decree-Law 33/2021.
| Length of service | Annual leave entitlement |
|---|---|
| Under 6 months | None as of right |
| 6 to 12 months | 2 days per month worked |
| Over 1 year | 30 calendar days per year |
Note that the 30 days are calendar days, not working days — so weekends falling inside a leave period are counted. This is one of the most common misunderstandings about UAE annual leave, and it is why 30 days of entitlement is closer to 22 working days in practice.
This is where most employees are short-changed, and the rule is not intuitive:
On a gross of AED 10,000 with a basic of AED 6,000, each encashed day is worth AED 200, not AED 333. Across 30 days that is a difference of about AED 4,000.
daily leave rate = monthly basic ÷ 30
Then multiply by the number of unused days. The divisor is 30 regardless of how many days are in the actual month.
No. Unused annual leave that you were entitled to cannot simply be cancelled at the end of service — it must be paid. What an employer can generally do during employment is set the timing of leave and require you to take it, and many contracts limit how much leave can be carried forward from one year to the next. A carry-forward limit is not the same as forfeiting leave you accrued in the year you left.
If your final settlement shows zero leave encashment despite untaken leave, that is one of the most common grounds for a MOHRE complaint. How to file a complaint →
Divide your monthly basic salary by 30 to get a daily rate, then multiply by the number of unused annual leave days. Encashment at the end of service is paid on basic salary, not gross.
30 calendar days a year once you have completed one year of service. Between six and twelve months you accrue two days per month. Under six months there is no statutory entitlement.
Calendar days. Weekends and public holidays falling inside your leave period are counted within the 30 days, which is why the practical figure is closer to 22 working days.
Basic salary when it is encashed at the end of service. When you actually take leave during employment you are paid your full normal salary including allowances. The difference catches out most employees.
No. Leave you have accrued and not taken must be paid on termination. Contracts may limit carry-forward between years, but that is different from cancelling leave accrued in your final year.
Public holidays are a separate entitlement and are not deducted from your 30 days. However, if a public holiday falls during a period of annual leave you have already booked, practice varies by employer — check your policy.