UAE Notice Period and Garden Leave: 2026 Guide

• Cancels the work permit and visa before the notice period ends
• Bars the employee from the office but also stops the Wages Protection System (WPS) transfer
• Treats the early walk-out as a resignation rather than a paid garden-leave instruction Any of those moves can convert a clean garden-leave exit into a wrongful-termination claim, with notice-pay damages and potential arbitrary-dismissal compensation under Article 47 (capped at three months' total wages). The garden-leave instruction by itself is not the problem — stripping the pay or benefits underneath it is. ### What the employee can and cannot do during garden leave While on garden leave the employee is still employed by the original employer. Practically: - They cannot start a new job that requires a UAE work permit during the notice period — the permit cannot be transferred until the current contract terminates and the resident visa transitions.
• They remain bound by the contract's confidentiality and conflict-of-interest clauses.
• They continue to accrue end-of-service gratuity and annual leave (more on this below).
• They can usually use the time to interview, complete handover documents remotely, or rest — there is no UAE law requiring them to be "available" on call unless the contract says so. ## Payment in lieu of notice (PILON) Article 43(3) also gives both sides an escape hatch: payment in lieu of notice. If either party wants the contract to end immediately rather than letting the notice run, they can pay the other side a sum equal to the wage the worker would have earned during the unserved portion of the notice period — calculated on the worker's last wage, not basic salary alone. In practice: - An employer wanting an employee gone today owes the employee that day's last-wage figure multiplied by the unserved notice days.
• An employee wanting to leave tomorrow owes the employer the same calculation in reverse — and that figure can be deducted from the employee's end-of-service entitlements before payment. PILON is a payment mechanic, not a punishment. It works in both directions and it does not by itself trigger an arbitrary-dismissal finding. What does trigger arbitrariness is using PILON as cover for a dismissal that was retaliatory, discriminatory, or otherwise outside the law's permitted grounds. ## Gratuity and leave accrual during notice This is where notice-period mechanics matter most in money terms. Two questions come up in nearly every dispute: ### Does end-of-service gratuity keep accruing during notice? Yes. The employment relationship continues until the last day of the notice period. End-of-service gratuity (Articles 51 and 52 of the Employment Law) is calculated on the total length of service through that final day. A 90-day notice period therefore adds three months of accrual to the gratuity figure, often shifting the calculation into a higher band for workers crossing the 1-year or 5-year service thresholds. The formula remains the standard one — 21 days of basic wage per year for the first 5 years, 30 days per year thereafter, pro-rated for partial years. See our end-of-service gratuity calculation guide for the worked examples. ### Does annual leave keep accruing during notice? Yes. Annual leave entitlement under Article 29 of the Employment Law (30 calendar days per year for workers who have completed one year of service, pro-rated below that) continues to accrue through the notice period. Untaken accrued leave is paid out in cash at termination as part of the final settlement. If the employer forces the employee to take accrued annual leave during the notice period — sometimes labelled "notice leave" — the employee can usually refuse, depending on the contract terms. Forcing it without consent is one of the recurring complaints raised at MoHRE conciliation. If the employee chooses to take leave during notice, no problem; if it's a unilateral instruction, get it in writing and consider speaking to a verified employment advocate before signing off. ## Non-compete clauses — how far do they actually reach? Non-compete clauses are the second-most fought issue at the end of a senior UAE role, right after gratuity. Article 10 of Federal Decree-Law No. 33 of 2021 allows non-compete clauses, but ties them to four limits — and Cabinet Resolution No. 1 of 2022 (as amended) sharpens those limits further. A UAE non-compete is enforceable only where the clause: - Is in writing in the employment contract or a separate written agreement
• Is limited in time to no more than two years from contract termination
• Is limited geographically to a defined area (not "the entire Middle East")
• Is limited in scope to the actual nature of the work that could harm the employer's legitimate interests
• Identifies a legitimate interest — confidential client lists, trade secrets, proprietary methods — not a general bar on working in the same industry The ministerial guidance issued under Cabinet Resolution No. 1 of 2022 created practical carve-outs. A non-compete cannot be enforced where: - The employee earns below a defined wage threshold (skill-level dependent; verify with current MoHRE practice for your salary band)
• The employer terminates the contract for a reason not attributable to the employee
• The employee and the new employer reach a written settlement with the previous employer
• The new role is in a sufficiently different field that the employer's legitimate interest is not actually threatened In court, the test is reasonableness on all four limits combined. A two-year worldwide ban on "working in financial services" will not survive; a six-month ban on contacting the previous employer's named client list in Dubai usually will. If a non-compete shows up in your contract on the way out the door, the question is rarely "is it enforceable?" — it's "on which of the four limits is it weakest?" ## Common scenarios that land at MoHRE ### Senior employee resigning to join a competitor The most common 90-day-notice scenario. The employer often instructs garden leave on the same day notice is served — paid, but barred from the office and from competitor contact. The contractual non-compete then activates from the termination date. If the employee tries to start the new role before the notice ends, expect a work-permit objection from the old employer and a likely MoHRE complaint. The cleanest path is a written tri-party settlement (old employer, new employer, employee) waiving the non-compete in exchange for a short cooling-off period. ### Role redundancy / employer-side termination Where the employer terminates a role for redundancy (a valid termination reason under Article 42), the 30-90 day notice still applies — the employer cannot skip it without paying PILON. The employee continues to accrue gratuity and leave through the notice. If the contractual non-compete was tied to the employee's continued employment, redundancy often falls into the carve-out where the employer's own termination disables the clause. ### End-of-project consultant on a limited-term contract Under the 2022 reforms, all mainland contracts are limited-term (Article 8). Limited-term contracts still carry a 30-90 day notice for early termination by either party. Reaching the natural end of the contract is not termination — no notice is required, but a written non-renewal communication a few weeks ahead is best practice. End-of-service gratuity is still due for service of one year or more. Questions outside this article's scope — including queries answered in real time and in plain Arabic — can go to our AI legal assistant. ## What to do if the employer cuts pay during garden leave Four steps, in order: - Pull the WPS bank record and confirm the salary missed its contractual deposit date.
• Write to HR in writing (email, not WhatsApp) noting the missed payment and asking for the date it will be regularized.
• File a MoHRE complaint via 600 590 000, the MoHRE smart app, or a Tas'heel service centre — failure to pay during notice is one of the strongest unpaid-wage claims the conciliator sees.
• Speak to a verified UAE employment advocate before the first MoHRE session, especially if a non-compete is also in play. Most employer-cut-pay garden-leave cases settle at conciliation once the WPS record is on the table. The pressure sits on the employer's side — the new work-permit quota is exposed the moment MoHRE opens the file. ## Employment Lawyers in Dubai If you need representation on a live notice-period, garden-leave, or non-compete dispute, browse verified employment lawyers in our Dubai directory. Every profile shows: - The lawyer's published consultation rate (AED, set by the lawyer)
• UAE bar-licence verification status
• Practice-area focus (employment law, notice and termination, non-compete defence, gratuity claims, DIFC employment)
• Languages spoken (Arabic, English, Hindi, Urdu, Tagalog, Filipino, Russian, French)
• Years admitted in the UAE Filter by verified employment lawyers in Dubai who handle senior-exit and non-compete matters specifically. Read the lawyer's published profile and statement, then contact them directly. LEXAI is a directory — clients contact lawyers directly and pay at the rate the lawyer publishes off-platform. As the UAE's first AI-powered legal directory, we verify the bar licence and surface verified profiles; payment terms sit between you and your chosen advocate. ## Five things to do today if you're heading into notice - Re-read your contract for the exact notice period (30, 60 or 90 days) and any garden-leave wording
• Pull six months of WPS records — they're the strongest evidence if pay stops during notice
• Save the resignation or termination letter in PDF with the date stamp visible
• Map the non-compete clause against the four Article 10 limits before signing anything new
• Speak to a verified employment advocate in Dubai before, not after, the work permit is cancelled Knowing how the UAE notice period actually works — 30 to 90 days, paid throughout, gratuity and leave accruing, garden leave permitted while pay continues — turns a stressful exit into a structured handover you can plan around.

Direct answer. UAE notice periods under Federal Decree-Law No. 33 of 2021 (Article 43) run 30 to 90 days, set in the employment contract. Garden leave — keeping the employee on payroll with no work expected — is permitted, and gratuity plus annual-leave entitlements continue to accrue throughout. This article covers the notice-period mechanics, pay-in-lieu-of-notice (PILON), non-compete enforceability under Article 10 + Cabinet Resolution 1 of 2022, and what happens when an employer pushes an employee out the door early.

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