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Friday , January 24 2020

Encashment of unused leave balance

I have unused leave balance and am entitled to leave encashment on my resignation from the company. What would be the salary that I will be getting for my unused leave on resignation?

Would this be the basic only or last drawn salary including accommodation and travel allowances?

Please provide relevant law reference for the above.

Name withheld

Answer: Article 62 of the Kuwait Labor Law states that “The calculation of the worker’s entitlements shall be made on the basis of the latest remuneration received by the worker”.

The word used here is “remuneration” and not basic salary. And “remuneration”, according to the second paragraph of Article 55 of the Kuwait Labor Law, includes all “the payments made to the worker on regular basis including allowances etc…”.

So, the calculation of the payment for your unused annual leave should be based on “remuneration” as defined by us above.

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