Table of Contents
Frequently Asked Questions
Can an employer in the UAE refuse an unpaid leave request?
Yes. Article 33 of Federal Decree-Law No. 33 of 2021 allows unpaid leave only with the employer's consent, so it is not a statutory entitlement. Approval is a management decision, and the employer can decline it. Any agreement should be recorded in writing.
Does an employee still receive gratuity after taking unpaid leave?
Gratuity is calculated on the employee's period of service, and Article 51 of the Decree-Law excludes unpaid absence days from that period. The employee keeps gratuity for the rest of their service. Keeping the leave dates on file supports an accurate calculation.
Is unpaid leave allowed during the probation period?
The law does not guarantee unpaid leave at any stage, including probation. An employer may approve it by agreement, but should first review the contract and the probation terms. Any approval should be documented with clear start and return dates.
Does an employee's visa stay valid during unpaid leave?
The employment contract stays in force during approved unpaid leave, so the residence visa and the employer's sponsorship remain active. The employer continues to carry visa and medical insurance costs. Long absences outside the UAE raise residency validity questions that should be reviewed before approval.
Do public holidays during unpaid leave get paid?
Salary is not paid for the period of unpaid leave. A public holiday falling inside that period is therefore not separately paid, unless the employment contract says otherwise. Employers should state this in the written leave agreement.
Does MOHRE regulate unpaid leave for free zone employees?
The federal Labour Law, including its leave rules, applies in most free zones. The difference is administrative: Meydan Free Zone, not MOHRE, issues its companies' employment visas and permits. A Meydan Free Zone company should record any unpaid leave in a signed agreement.
What should a written unpaid leave agreement include?
It should state the start date, end date and return date, and confirm that no salary is paid for the period. It should also note how visa, insurance and payroll are treated. Both parties should sign it, and the employer should keep it in the employee file.
What happens if an employee takes leave without approval?
Absence without approval is not unpaid leave. The employer can record it as unauthorised absence, and long unexcused absences can justify dismissal under Article 44 of the Labour Law after an investigation. Disputes on the mainland go through MOHRE.
Topic Summary
What Unpaid Leave in the UAE Means
Unpaid leave is an agreed absence from work during which the employer pays no salary. It is not a statutory entitlement for private-sector staff: Article 33 of Federal Decree-Law No. 33 of 2021 allows it only with the employer's consent. The employment contract stays in force while the employee is away.
Unpaid Leave Under UAE Labour Law
Under UAE labour law, unpaid leave depends on employer approval and the terms of the employment contract. Salary stops for the agreed period, and the employer should record the dates in writing. The federal rules apply to mainland employers and most free zone companies, although the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) have their own employment laws.
Payroll, Gratuity and Cost Implications
During unpaid leave the employer pays no salary, and the unpaid days do not count as service for end-of-service gratuity. The residence visa and medical insurance stay active and keep costing money, so compare these obligations with the salary saved before approving a long absence.
Steps to Handle an Unpaid Leave Request
To handle an unpaid leave request in the UAE, review the contract, assess business impact, agree dates in writing, update payroll, confirm visa and insurance status, and record the return date. This sequence keeps the arrangement documented and reduces the chance of a later labour dispute.
Unpaid Leave for a Meydan Free Zone Company
A Meydan Free Zone company should record unpaid leave in a written agreement and reflect it in payroll. The federal leave rules still apply, but Meydan Free Zone, not MOHRE, issues its companies' employment visas and permits. mResidency covers residency visas and medical insurance, so check the visa position before a long absence abroad.
Decision Table for Unpaid Leave Requests
Founders weigh unpaid leave by comparing the absence length, the cost of keeping the visa and insurance active, and the cover needed. Short absences with a clear return date are easy to approve. Long absences abroad need closer review of residency, insurance and replacement costs.
Conclusion
Unpaid leave in the UAE works on agreement, not entitlement. Approve it in writing, reflect it in payroll, and track the effect on gratuity, visa and insurance costs. Set a short written leave template before the next request arrives. For a Meydan Free Zone company, residency visas and medical insurance run through mResidency, so check that position before approving a long absence abroad.
Unpaid Leave Rules in the UAE
In a small team, one long absence can leave clients waiting and still carry visa and insurance costs. Founders often ask whether staff have a right to unpaid leave, or whether they can simply refuse a request. This guide explains how unpaid leave works in the UAE, what it does to pay, gratuity and visa status, and how to record it.
What Unpaid Leave in the UAE Means
Unpaid leave is an agreed absence from work during which the employer pays no salary. It is not a statutory entitlement for private-sector staff: Article 33 of Federal Decree-Law No. 33 of 2021 allows it only with the employer's consent. The employment contract stays in force while the employee is away.
Definition and Legal Basis
Private-sector employment is governed by Federal Decree-Law No. 33 of 2021, which replaced Federal Law No. 8 of 1980. Unpaid leave sits outside the standard leave categories, such as annual or sick leave, and depends on the employer's consent. The Ministry of Human Resources and Emiratisation (MOHRE) publishes the official guidance for mainland employers.
Take a designer who asks for four weeks off to handle a family matter abroad. The founder agrees in writing, with no salary for that period. The contract continues throughout.
What Founders Commonly Assume
Two assumptions cause trouble. The first is that staff can demand unpaid leave once paid leave runs out. The second is that refusal is always unlawful. In practice, approval is a management decision, and it should be documented.
Say a sole-founder company receives a request after an employee has used all annual leave. The founder can approve, offer a shorter period, or decline. What matters is that the outcome is recorded.
Unpaid Leave Under UAE Labour Law
Under UAE labour law, unpaid leave depends on employer approval and the terms of the employment contract. Salary stops for the agreed period, and the employer should record the dates in writing. The federal rules apply to mainland employers and most free zone companies, although the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) have their own employment laws.
Employer Approval and Written Agreement
Verbal agreements are the most common source of later disputes. A written record protects both sides. It should state:
- The start date and end date.
- The return-to-work date.
- That no salary is payable.
- Who approved it, and when.
An email exchange confirming dates and zero pay, signed off by both parties, is enough for a small team.
Unpaid Leave Compared With Annual Leave
Annual leave is a statutory entitlement and is paid. Unpaid leave is discretionary. Say an employee combines annual leave with two unpaid weeks. Only the annual leave portion is paid. Public holidays that fall inside the unpaid period are not separately paid unless the contract says otherwise. See the guide to public holidays in the UAE for how public holidays are set.
Unauthorised Absence and Its Risks
Absence without approval is not unpaid leave. If an employee leaves for a month without sign-off, the employer should record it as absence. Under Article 44 of the Decree-Law, long unexcused absence can justify dismissal without notice after a written investigation. The limits are more than seven consecutive days, or more than 20 days in a year. Our overview of a labour dispute in Dubai covers how disputes are handled.
Payroll, Gratuity and Cost Implications
During unpaid leave the employer pays no salary, and the unpaid days do not count as service for end-of-service gratuity. The residence visa and medical insurance stay active and keep costing money, so compare these obligations with the salary saved before approving a long absence.
Salary and Wage Records
Payroll must show the unpaid period accurately. A two-week absence in the middle of a month needs a clear basis for the deduction, tied to the signed agreement. Mainland employers pay through the Wage Protection System, so the records must match. Our note on the UAE salary payment rule explains the wage deadline.
Gratuity and Service Calculation
Article 51 of the Decree-Law excludes unpaid absence days from the service period used for gratuity. This matters most when an employee is close to the one-year service threshold. Keep leave dates on file to support the final settlement.
Visa, Insurance and Ongoing Costs
The residence visa and health insurance stay active during the absence. Picture an employee abroad for several months while the insurance premium continues. Long absences outside the UAE also raise residency validity questions. That means you should set these costs against the salary saved.
Steps to Handle an Unpaid Leave Request
To handle an unpaid leave request in the UAE, review the contract, assess business impact, agree dates in writing, update payroll, confirm visa and insurance status, and record the return date. This sequence keeps the arrangement documented and reduces the chance of a later labour dispute.
Step 1: Review the Contract and Leave Policy
- Look for an existing unpaid leave clause.
- Check whether the employee is on probation.
- Note any notice requirements.
If the contract has no clause, handle the request as a one-off agreement.
Step 2: Assess Business Impact and Decide
- Confirm who covers the work.
- List client deadlines in the period.
- Consider the precedent for other staff.
A trading company with one logistics coordinator, weighing a six-week absence, may offer a shorter period instead.
Step 3: Document, Update Payroll and Confirm Return
- Get a signed written agreement.
- Adjust payroll.
- Check visa and insurance status.
- Fix the return-to-work date.
A one-page leave confirmation kept in the employee file is enough.
Unpaid Leave for a Meydan Free Zone Company
A Meydan Free Zone company should record unpaid leave in a written agreement and reflect it in payroll. The federal leave rules still apply, but Meydan Free Zone, not MOHRE, issues its companies' employment visas and permits. mResidency covers residency visas and medical insurance, so check the visa position before a long absence abroad.
Free Zone Employment Framework
Most federal leave rules apply to free zone companies too, but check the free zone's own procedures for permits and records. The signed employment contract carries the detail. A Meydan Free Zone consultancy with three staff, for example, should record an unpaid sabbatical in writing. Read more on Dubai labour law and Meydan Free Zone.
Short Absence Versus Extended Absence
| Feature | Short Absence | Extended Absence |
|---|---|---|
| Salary treatment | One partial-month deduction, easy to show on payroll | Several months with no salary, so a larger saving |
| Visa and insurance cost | Small cost against a short period | Premiums continue and residency validity needs review |
| Cover required | Colleagues can usually absorb the work | Temporary or freelance cover is often needed |
| Gratuity effect | Minor effect on service days | Larger effect on service days, so calculate before agreeing |
| Documentation needed | One-page confirmation with dates | Signed agreement, payroll note, visa and insurance check |
Visa and Accounting Support Through Meydan Plus
Meydan Plus is the Meydan Free Zone business support ecosystem. mResidency offers residency visas, the medical fitness test, Emirates ID, medical insurance, dependent visas and return permits. mAccounting offers bookkeeping, VAT and Corporate Tax support. Bookkeeping support helps keep the accounts consistent with an unpaid month.
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Calculate NowDecision Table for Unpaid Leave Requests
Founders weigh unpaid leave by comparing the absence length, the cost of keeping the visa and insurance active, and the cover needed. Short absences with a clear return date are easy to approve. Long absences abroad need closer review of residency, insurance and replacement costs.
Weighing a Short Request Against a Long One
The table above sets out the differences. Take a two-week request against a three-month request from the same employee. The first is simple to cover. The second may justify saying no, or offering a shorter period instead.
What This Means for a Founder's Decision
Weigh retention against cover cost. Keep terms consistent across staff, because one approval sets a precedent. Document every decision. A founder who offers a shorter period with a fixed return date usually keeps the employee and the control.
Conclusion
Unpaid leave in the UAE works on agreement, not entitlement. Approve it in writing, reflect it in payroll, and track the effect on gratuity, visa and insurance costs. Set a short written leave template before the next request arrives. For a Meydan Free Zone company, residency visas and medical insurance run through mResidency, so check that position before approving a long absence abroad.
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Let's ConnectReferences
- Ministry of Human Resources and Emiratisation (MOHRE), employment and labour relations guidance, 2025.
- Dubai Health Authority (DHA), health insurance requirements in Dubai, 2025.
