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Does Unpaid Leave Affect Your Gratuity?

Short answer: usually yes, but which leave counts and which doesn't varies more than most people expect, and it's one of the most common reasons a self-calculated gratuity figure doesn't match what HR actually pays out.

United Arab Emirates

● Clearly documented in law

Under Article 51 of Federal Decree-Law No. 33 of 2021, gratuity is calculated on continuous service. Unpaid leave days are explicitly excluded from that count, they get subtracted from your total service period before the gratuity formula is applied. Paid leave, annual leave, public holidays, and importantly, maternity leave and sick leave, even the unpaid portions of those two specifically, still count toward service and are not deducted.

Example: an employee with 3 years of continuous employment who took 60 days of unpaid personal leave during that time has their service period calculated as 3 years minus 60 days, not a flat 3 years, when the gratuity formula is applied.
Source: UAE Federal Decree-Law No. 33 of 2021, Article 51.

Saudi Arabia, Qatar and Bahrain

● General principle, less explicit sourcing

Being transparent about the limits of what's publicly documented here: all three countries calculate gratuity on the basis of actual, continuous service, and it's a reasonable and widely repeated general principle that periods of genuinely unpaid leave reduce that count the same way they do in the UAE. But unlike the UAE, none of the three publishes a provision as explicit and specific as Article 51's unpaid leave carve-out in the sources available to us. If unpaid leave is a real factor in your situation in one of these three countries, this is exactly the kind of detail worth confirming directly with your HR department or a licensed payroll professional rather than assuming it works identically to the UAE.

What consistently does not get deducted

Across all four countries, paid annual leave, public holidays, and standard sick leave count toward your service period without question. In the UAE specifically, even the unpaid portion of maternity leave and sick leave is protected and still counts, a detail that trips up a lot of manual calculations since it's the opposite of what you'd assume once you know unpaid leave in general gets deducted.

The practical takeaway

If your employment included any stretch of genuinely unpaid leave, the calculator on this site, like every calculator that works from a simple years-and-months input, will overstate your gratuity slightly, since it assumes continuous service throughout. For a precise figure, subtract your unpaid leave days from your total tenure before entering it, in the UAE that adjustment is legally required, in the other three, it's the safer assumption pending direct confirmation from HR.

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Reviewed by the Gratuity Tracker editorial team

This guide distinguishes explicitly documented rules from general regional principles rather than presenting both with equal confidence. Last verified 14 September 2026.