Salary earned by working for an Insurance Company and money accumulated from paid sick leave?

Answered according to Hanafi Fiqh by


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Hazrar, I ask this question on behalf of a cousin of mine.


Many years ago he used to work for a Car insurance company he was responsible for generate quotes for customers who were wanting to insure their car for the company he used to be working with.


Whilst there he tool extended “sick” leave from work due to issues with his back. He was able to get a doctor’s note to confirm this was the case. However, he got a little too relaxed and prolonged the leave longer than necessary. Basically he was fit enough to go back to work much earlier, but continued lie to his employer that his back was still troubling him, and to his doctor, so he could get more medical claims to support his deceitful claim.


Question is as follows:


1)      Is he required to pay ALL the money he had been paid during his sick leave from the point when he knew he should/could back to work back to his employer?

2)      What, if he can’t work out exactly how much month’s salary he been paid as this goes back quite a few years.

3)      Is he also expected to pay all the money back ever earned from working there (15 years) since insurance itself is haram? That’s almost £200, 000.






In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

At the outset, it is important to note that lying and deceiving are prohibited practices in Islam. Allah Ta’ala says:


يَـٰٓأَيُّهَا ٱلَّذِينَ ءَامَنُواْ لَا تَأۡكلُوٓاْ أَمۡوَٲلَكُم بَيۡنَكم بِٱلۡبَـٰطِلِ إِلَّآ أَن تَكُونَ تِجَـٰرَةً عَن تَرَاضٍ۬ مِّنكُمۡ‌ۚ


“O you who believe, do not consume each other’s wealth by false means, unless it is a trade conducted with your mutual consent.” (Surah an Nisa – Verse: 29)


Based on this, a key principle of Islamic commercial law is that transactions and contracts are based on mutual consent.[1] As such, when employed by an individual or company for specified times (Ajeer Khaas), one must honor the terms and conditions set out in one’s employment contract, and not breach them in any way. 


Allah Ta’ala says:


وَيۡلٌ۬ لِّلۡمُطَفِّفِينَ (١) ٱلَّذِينَ إِذَا ٱكۡتَالُواْ عَلَى ٱلنَّاسِ يَسۡتَوۡفُونَ (٢) وَإِذَا كَالُوهُمۡ أَو وَّزَنُوهُمۡ يُخۡسِرُونَ (٣) أَلَا يَظُنُّ أُوْلَـٰٓٮِٕكَ أَنَّهم مَّبۡعُوثُونَ (٤) لِيَوۡمٍ عَظِيمٍ۬ (٥) يَوۡمَ يَقُومُ ٱلنَّاسُ لِرَبِّ ٱلۡعَـٰلَمِينَ (٦) كَلَّآ إِنَّ كِتَـٰبَ ٱلۡفُجَّارِ لَفِى سِجِّينٍ۬ (٧) وَمَآ أَدۡرَٮٰكَ مَا سِجِّينٌ۬ (٨) كِتَـٰبٌ۬ مَّرۡقُومٌ۬ (٩)


“Woe to those who curtail. (1) Who, when they measure something to receive from people, take it in full, (2) And when they measure or weigh something to give it to them, give less than due. (3) Do they not think that they have to be raised up (4) On a Great Day, (5) The Day when all the people will stand before the Lord of the worlds? (6) Never! (i.e. they should never act in such a way.) Indeed the record of deeds of the sinners is in Sijjin. (7) And what may let you know what Sijjin is? (8) A register, inscribed! (9)” (Surah al Mutaffifeen – Verse: 1-9)


The term “Tatfif” mentioned in the verse has a wide-ranging implication, and not restricted to measurement and weight. If an employee takes the full salary, but does not work for the full required hours, then this too comes under the definition of “Tatfif” and hence sinful. One must realize that if one does not put in a proper day’s work, one will be answerable to Allah Ta’ala on the Day of Judgment. It may be possible to conceal one’s behavior from the employer but not on the Day of Judgement when each and every minute will have to be accounted for.[2]

Thus, the answers to your questions are as follows:

1. Many companies give their staff a certain number of days paid sick-leave per year. In this instance, it is permitted to receive a salary for the days taken off; provided one is honest and genuinely ill. If one is not genuinely ill and is merely taking advantage, then he/she is not entitled to the salary. Thus, a proportionate amount from the salary must be returned to the company for the days spent away from work when one was fit to return to work. If the money cannot be returned to the company.[3] If the money cannot be returned to the company, then it must be given away in Sadaqah. If one does not do so, one will be consuming unlawful (haram) wealth.[4]

2. One should estimate to the best of his/her ability the proportionate amount of salary that needs to be returned to the company. It is advisable to calculate in excess of the actual amount.

3. Insurance is Haram. However, your cousin was an employee and his income was due to his services he provided.[5] The actual work of providing quotes itself is not Haram.[6] However, it is possible his source of income being from an insurance company has been contaminated.[7]

He should make Taubah and Istighfar for that. He does not have to repay all the income of 15 years.  


And Allah Ta’āla Knows Best

Abdullah ibn Mohammed Aijaz

Student Darul Iftaa
Baltimore, USA

Checked and Approved by,
Mufti Ebrahim Desai.


[3] الدر المختار وحاشية ابن عابدين (رد المحتار) (6/ 69)

وهو الأجير (الخاص) ويسمى أجير وحد (وهو من يعمل لواحد عملا مؤقتا بالتخصيص ويستحق الأجر بتسليم نفسه في المدة وإن لم يعمل كمن استؤجر شهرا للخدمة أو) شهرا (لرعي الغنم) المسمى بأجر مسمى بخلاف ما لو آجر المدة بأن استأجره للرعي شهرا حيث يكون مشتركا إلا إذا شرط أن لا يخدم غيره ولا يرعى لغيره فيكون خاصا وتحقيقه في الدرر وليس للخاص أن يعمل لغيره، ولو عمل نقص من أجرته بقدر ما عمل فتاوى النوازل (وإن) (هلك في المدة نصف الغنم أو أكثر) من نصفه (فله الأجرة كاملة) ما دام يرعى منها شيئا، لما مر أن المعقود عليه تسليم نفسه جوهرة، وظاهر التعليل بقاء الأجرة لو هلك كلها وبه صرح في العمادية


(قوله وليس للخاص أن يعمل لغيره) بل ولا أن يصلي النافلة. قال في التتارخانية: وفي فتاوى الفضلي وإذا استأجر رجلا يوما يعمل كذا فعليه أن يعمل ذلك العمل إلى تمام المدة ولا يشتغل بشيء آخر سوى المكتوبة وفي فتاوى سمرقند: وقد قال بعض مشايخنا له أن يؤدي السنة أيضا. واتفقوا أنه لا يؤدي نفلا وعليه الفتوى. وفي غريب الرواية قال أبو علي الدقاق: لا يمنع في المصر من إتيان الجمعة، ويسقط من الأجير بقدر اشتغاله إن كان بعيدا، وإن قريبا لم يحط شيء فإن كان بعيدا واشتغل قدر ربع النهار يحط عنه ربع الأجرة. (قوله ولو عمل نقص من أجرته إلخ) قال في التتارخانية: نجار استؤجر إلى الليل فعمل لآخر دواة بدرهم وهو يعلم فهو آثم، وإن لم يعلم فلا شيء عليه وينقص من أجر النجار بقدر ما عمل في الدواة


(قوله وظاهر التعليل إلخ) أي فقول الجوهرة ما دام يرعى منها شيئا لا مفهوم له. ورأيت بخط بعض الفضلاء أن مراد الجوهرة تحقيق تسليم نفسه بذلك لا شرط استحقاق الأجر كما فهم المصنف والمتون والتعليل يفيده اهـ وهو حسن. (قوله وبه صرح في العمادية) وهو الموافق لتصريح المتون بأنه يستحق الأجر بتسليم نفسه في المدة وإن لم يعمل.


فتاوى الوازل ص.381-382 للفقيه ابي الليث السمرقندى   م.375


Aap ke Masail aur unka Hal V.7/PG.87


[4] الدر المختار وحاشية ابن عابدين (رد المحتار) (6/ 385)

لأن سبيل الكسب الخبيث التصدق إذا تعذر الرد على صاحبه



3.      سبب بعيد – Those actions that are not directly related to the sin, but become a means for the sin to be committed at a later stage. For example, a person sells grapes to another person who will later make it into grape juice to make wine from it. Such actions are permissible, but will be makrooh tanzihi (disliked) if the person knows that the sin will be committed.


Extracted from: Jawahirul Fiqh – Mufti Muhammed Shafi Uthmani – Vol.2 Pgs.439-462 – Maktabah Darul ‘Uloom Krachi


Salary received from occupations in banks, etc.

The salary received from those occupations that necessitate direct involvement in interest is not permissible. Similarly, salaries and wages received from those actions that constitute the actual meaning of assistance in sin and those actions that are directly related to the sin and are a means for the sin coming into existence are also not permissible.


ولا تجوز الإجارة على شيء من الغناء والنوح والمزامير والطبل وشيء من اللهو وعلى هذا الحداء وقراءة الشعر وغيره ولا أجر في ذلك وهذا كله قول أبي حنيفة وأبي يوسف ومحمد رحمهم الله تعالى كذا في غاية البيان

(Fatawa Al-Hindiyyah Vol.4 Pg449 – Maktabah Rasheediyah)

Salaries received from those actions that are directly related to the sin but are not a means for the sin to come into existence and those actions that are not directly related to the sin are permissible, on condition that one does not make intention of the sin and majority of the money at the institution is not interest money. However, if more than 50% of the funds present at the institution is interest money or impermissible money, it will not be permissible to receive wages for any kind of service done for the company.


(Ahsan al-Fatawa Vol.7 Pg.329 – H.M.Sa’eed Company)



Non-Life Insurance Companies (property, car, liability, etc). The second type of insurance companies are non-life. They insure houses, cars, etc. Their total capital is broadly speaking, composed of the following:

a.) Investment Capital [Halal]: Assumed halal as long as there is no proof to establish otherwise.

b.) Insurance Premiums [Haram]: The reason this is haram is because the company obtained this amount through a prohibited transaction. Here, this transaction differs from the loan taken by the life insurance company in the previous example because in this case it is not known if the company will have to pay for damage to the car or to the home. This entails contractual uncertainty [gharar] and interest [riba] and as a result, is an invalid [batil] transaction which means these funds are haram.

أما أقساط التأمين فأنها حصلت عليها الشركة بعقد محظور…وعلى هذا فأنه عقد باطل مثل الربوا وأقساط التأمين التي أخذت من أصحابها كلها حرام – الفقه البيوع  ٢ص. ١٠٦٨ – ١٠٦٩

c.) Profit accrued [Haram]: This money is haram.

Ruling: The majority of the capital in non-life insurance companies is haram, and an employee of this type of company needs to take into consideration that a large part of the initial investment capital (the only halal source of funds in this case) was quiet possibly spent on infrastructure and start-up costs.

Whatever halal capital is left over, if any, should be equal to or greater than what the employee (performing a permissible function) receives in a non-life insurance company for the duration of his employment there for the entire income to be deemed halal. However, even in this case it will be better to avoid working in any insurance company.

If the halal capital has been exhausted in infrastructure or other costs or is not enough to cover the entire duration of his employment, then whatever wealth the Muslim employee receives from the haram funds of the insurance company will be haram (assuming his duties are all permissible in nature otherwise it would not be permissible to work there in the first place).

An example to clarify the above is what is related from Imam Muhammad (may Allah have mercy on him):

A man usurps [gasb] 10 dinars and adds 1 dinar of his own. The usurper [gasib] then gives another man 1 dinar from these 11 dinars, it will be permissible for the latter to take this 1 dinar (since from that 11 dinars, 1 dinar was from halal wealth.)

If the usurper gives the man another dinar from the remaining 10 dinars, it will not be permissible to take it since this second dinar is from haram wealth. Here, the halal portion of the 11 dinars is much less than 51%, but it was permitted for the person to take up to the amount of halal wealth present in those 11 dinars.

فلم يبق من المحكوم عليه بالحلال في أموال الشركة إلا رأس المال. وحينئذ صارت أموال الشركة مخلوطة بالحلال والحرام…وقدمنا في أحكام هذا القسم أنه لا عبرة في بالغلبة بل يجوز التعامل معها بقدر ما فيها من الحلال…ولكن ينبغي أن يؤخذ في عين الاعتبار أن قدراً كبيراً من رأس المال يصرف عند إنشاء الشركة… – المرجع السابق، ص. ١٠٦٩

Note: A general rule is then established: Even if a company’s haram funds are 51% or more of its total capital, the employee’s salary will still be deemed halal. This, as long as: a.) the halal and haram wealth of the company is mixed together and not separated from one another b.) The halal funds are enough to cover the employee’s salary for the duration of his employment there and c.) The employee is performing a permissible function. 

وقد إشتهر على الألسن أن حكم التعامل مع من كان ماله مخلوطاً بالحلال والحرام أنه إن كان الحلال فيها أكثر جاز التعامل معه…ولكن ما يتحقق بعد سبر الكلام الفقهاء الحنفية في هذا الموضوع أن اعتبار الغلبة إنما هو فيما إذا كان الحلال متميزاً عن الحرام عند صاحبه ولا يعلم المتعامل معه أن ما يعطيه من الحلال أو من الحرام…أما إذا كان الحلال مخلوطاً بالحرام دون تمييز أحدهما بالآخر فإنه لا عبرة بالغلبة في هذه الحالة في مذهب الحنفية بل يحل الإنتفاع من المخلوط بقدر الحلال سواءٌ أكان الحلال قليلاً أم كثيراً – المرجع السابق، ص. ١٠٣١ – ١٠٣٢

 ينظر: فقه البيوع ٢/ ١٠٢٧ – ١٠٣٨ و ١٠٦٦ – ١٠٦٩ وقد بسط فضيلة الشيخ المفتي محمد تقي العثماني حفظه الله – الكلام في هذا الموضوع وأثبت بأدلة كثيرة أنه لا عبرة بالغلبة في هذه الحالة في مذهب الحنفية. ونذكر هنا بعضها على سبيل المثال لا الحصر

أ – جاء في الدر المختار: “أو اختلط المغصوب بملك الغاصب بحيث يمتنع امتيازه…ضمنه وملكه بلا حل انتفاع قبل أداء ضمانه” إن الضمير المنصوب في “ضمنه وملكه” يرجع إلى المغصوب لأنه محل الضمان والملك الجديد. أما ماله الحلال فلا هو يضمنه ولا يحدث له فيه ملك جديد. وقوله “بلا حل انتفاع ” متعلق بالضمان والملك الجديد، وليس متعلقاً بماله الذي لا يضمنه للمغصوب منه، وهو مملوك له قبل الخلط. فظهر أن عدم حل الإنتفاع متعلق بالحصة المغصوبة فقط

ب – ما روي عن الامام محمد رحمه الله تعالى في حل الإنتفاع بقدر الحلال بصراحة. جاء في التتارخانية عنه: “غصب عشرة دنانير فألقى فيها ديناراً ثم أعطى منه رجلاً ديناراً جاز ثم ديناراً أخرى لا” والحلال ههنا أقل ولكنه أجيز بقدر الحلال بدون اعتبار الغلبة

ج – ما أفتى به الشيخ أشرف علي التهانوي رحمه الله تعالي. فسئل عن رجل يسكن مع أبيه و إخوته الذين يكسبون عن طريق الرشوة ومال السائل حلال. وهو يشاركهم في مصاريف البيت. فأجاب رحمه الله تعالي: “الخلط استهلاك والاستهلاك موجب للملك. فإن كانت هذه المبالغ تصرف مجموعة يجوز للسائل حسب الفتوي وإن كان خلاف التقوى. وإن كان كل أحد يصرف مبلغه على التعاقب مميزاً عن المبالغ الأخرى فعندما يصرف مبلغ الرشوة فإن أكله حرام للسائل” – إمداد الفتاوى ٤/ ١٤٨ سؤال ١٨٢