UAE Full & Final Settlement (F&F) 2026 | Complete Guide for Dubai Mainland Employees

Key Facts: UAE employers must pay Full & Final Settlement within 14 days of contract end. F&F includes outstanding salary, annual leave encashment (basic salary), end-of-service gratuity (21 days/year for the first 5 years, 30 days thereafter), notice pay, and contractual dues, minus lawful deductions. Employees can file MOHRE (Ministry of Human Resources and Emiratisation) complaints for delayed payment.

Introduction

If you’re working on Dubai mainland or for a private-sector company in the UAE, your Full & Final Settlement (F&F) is the final payment you receive when your employment ends. It’s not just your last month’s salary; it’s everything you’re legally and contractually owed up to your final working day. Under Federal Decree-Law No. 33 of 2021, employers are required to clear all wages and entitlements within 14 days from the date your contract ends. This means your F&F should be processed and paid within two weeks of your last day, not dragged out for months.

What Is Full & Final Settlement (F&F)?

Full and Final Settlement is the last amount due to an employee upon the termination of his or her employment. It extinguishes all amounts due from the employer to the employee, such as salary, leave, gratuity, notice pay, and so on. F&F applies to employees in the private sector in the Dubai mainland under UAE Labour Law (Federal Decree-Law No. 33 of 2021) and MOHRE regulations.

7 Components of Full & Final Settlement

1. Outstanding Salary

All salary, wages, allowances, and overtime up to the final day of work shall be paid. This includes:

• Pay for the last month of work (if applicable)
• Set allowances (housing, transportation, etc.), if part of the wage structure
• Overtime, shift allowance, or commission that has been approved and not yet received.

2. Unused Annual Leave Encashment

Casualty pays for annual leave which has been accrued, but not used, at the end of service.

Key points:

• Based on basic salary or final wage (as per contract agreement)
• Relates to the annual leave earned by the employee through legal provisions (usually 30 days per year after 1 year of service)
• Does not typically provide sick, maternity, parental and/or compassionate leave, with or without exception by agreement only
• If the leave is in addition to a contract, please check encashment entitlement on a case-by-case basis

3. End-of-Service Gratuity

Full-time foreign employees who complete at least one year of continuous service are entitled to end-of-service gratuity.

Gratuity calculation (based on last basic wage):

• First 5 years: 21 days’ basic wage per year of service
• After 5 years: 30 days’ basic wage per year of service
• Proportionate gratuity applies for part of a year after completing one year
• Total gratuity cannot exceed two years’ basic wage

Example:

If basic salary is AED 10,000 and service is 3 years:

• Gratuity = (21 days × 3 years × AED 10,000) ÷ 30 = AED 21,000

4. Notice Period / Notice Pay

The employment contract and UAE Labour Law specify the notice period (typically 30–90 days).

Notice pay applies when:

• The employer or employee fails to serve the full notice period
• The contract is terminated without proper notice
• Notice period is reduced by mutual agreement

Compensation: Equal to the employee’s wage for the full notice period or the unserved portion, calculated on the last wage.

5. Other Contractual Entitlements

Any amounts legally or contractually due should be included:

• Unpaid commissions or bonuses
• Performance incentives
• Contractual allowances (education, phone, etc.)
• Benefits specified in company policy or employment contract

6. Lawful Deductions

Deductions from F&F must have a valid legal or contractual basis under UAE Labour Law.

Common lawful deductions:

• Outstanding loans or advances from employer
• Damage to company property (if proven and documented)
• Overpaid salary or allowances
• Court-ordered deductions

Important: Deductions cannot reduce the employee’s wage below the minimum wage (if applicable) and must follow MOHRE rules.

7. Timeline for Settlement

Under Article 53 of Federal Decree-Law No. 33 of 2021, employers must pay all wages and entitlements within 14 days from the contract end date.

F&F formula: Outstanding salary + Annual leave encashment + End-of-service gratuity + Notice pay − Lawful deductions = Total F&F

F&F Calculation Example

Scenario: Employee with 4 years of service, basic salary AED 8,000, 12 days unused leave, 30-day notice not served by employer.

Note: Actual amounts vary based on contract terms, exact service period, and deductions.

Who Is Covered?

This guide applies to:

• Dubai mainland employees working for private-sector entities
• Foreign full-time workers under UAE federal labour law
• Employees on limited or unlimited contracts

Not covered:

• Free-zone employees (subject to specific free-zone rules, though many follow federal law)
• Government/semi-government employees (federal or emirate-level HR laws)
• Domestic workers (separate regulations)
• Employees in special economic zones with alternative regimes

Employee Rights During F&F

Under MOHRE guidelines, employees have the right to:

• Receive all dues within 14 days of contract end
• Obtain a clear breakdown of F&F components
• File a labour complaint if F&F is delayed or incorrect
• Receive an end-of-service certificate and experience letter

Employer Obligations

Employers must:

• Calculate and pay F&F within 14 days
• Provide a written settlement statement
• Cancel the employee’s work permit and visa within the legal timeframe
• Avoid unlawful deductions from F&F
• Maintain accurate records of salary, leave, and gratuity

What If F&F Is Delayed?

If the employer fails to pay within 14 days:

1. Contact the employer in writing to request payment
2. File a complaint with MOHRE via the MOHRE app, website, or call centre (600 590 000)
3. MOHRE will attempt to resolve the dispute within 14 days
4. If unresolved, the case may be referred to the labour court

Penalties for employers: Late payment can result in fines, work-permit restrictions, and legal action.

How to Calculate Your F&F?

Step 1: Gather Documents

• Employment contract
• Last 3 months’ salary slips
• Leave balance statement
• Gratuity calculation (if available)
• Any loan or deduction records

Step 2: Calculate Each Component

Outstanding salary: (Basic salary + allowances) × Days worked in final month ÷ 30

Annual leave encashment: Basic salary × Unused leave days ÷ 30

End-of-service gratuity:

• For first 5 years: 21 × Years of service × Basic salary ÷ 30
• After 5 years: 30 × Years of service × Basic salary ÷ 30
• Cap: Maximum 2 years’ basic wage

Notice pay: Last monthly wage × Notice period (in months)

Step 3: Add and Deduct

Total = Salary + Leave + Gratuity + Notice pay − Lawful deductions

Common F&F Mistakes to Avoid

F&F for Different Termination Scenarios

Documents Required for F&F

Employees should provide:

• Passport copy
• Emirates ID copy
• Bank account details for final payment
• Resignation letter or termination notice
• Handover completion certificate

Employers should provide:

• Final settlement statement
• Gratuity calculation breakdown
• Leave encashment calculation
• Experience certificate (on request)
• NOC or release letter (if applicable)

Conclusion

Full & Final Settlement is an important legal obligation that requires employees to receive all dues, including salary, leave, gratuity, and notice pay, within 14 days of the termination of employment. Knowing your F&F entitlements allows you to confirm the settlement amount, prevent an unlawful deduction, and act quickly should the payments be delayed. Looking for F&F Calculation/Dispute? If you’re unsure about your F&F entitlement or facing delays, Arnifi can help. Our team is highly knowledgeable in UAE labour law compliance, F&F calculations and dispute resolution.

FAQs

1. How many days does an employer have to pay F&F in UAE?

Within 14 days from the contract end date under Article 53 of Federal Decree-Law No. 33 of 2021.

2. What is included in Full & Final Settlement?

Outstanding salary, unused annual leave encashment, end-of-service gratuity, notice pay (if applicable), and contractual dues, minus lawful deductions.

3. How is end-of-service gratuity calculated?

21 days’ basic wage per year for the first 5 years, then 30 days’ basic wage per year thereafter, capped at two years’ basic wage.

4. Is annual leave encashment mandatory in F&F?

Yes. Employees must be paid cash for accrued but unused annual leave, calculated on basic salary.

5. What if my employer delays F&F payment?

File a labour complaint with MOHRE; they must attempt to resolve it within 14 days and may refer the case to court.

6. Can my employer deduct money from my F&F?

Only lawful deductions are allowed (e.g., outstanding loans, proven damage, overpaid salary) and must comply with UAE Labour Law.

References: 

MOHRE – Workers’ Rights 

MOHRE – Federal Decree-Law No. 33 of 2021