Unpaid leave and gratuity
An employee took 2 months of unpaid leave. Does that count for gratuity?
The situation
Days of unpaid absence are generally not counted as service for gratuity.
The law
- Art 51, Federal Decree-Law 33 of 2021: End of service gratuity: 21 days basic wage a year for the first 5 years, 30 days after, capped at 2 years' wage
What it means for you
Deduct unpaid leave days from total service before calculating. Example: 3 years of service with 60 days unpaid leave means about 2 years and 10 months of service for gratuity. Keep leave approvals on file.
What to do
- Total the unpaid leave days.
- Deduct them from service.
- Calculate gratuity on the net service.
- Show the working on the settlement.
We can do this for youPayroll compliance: WPS salary runs, end of service gratuity, final settlement and payroll records: AED 95