UAE End-of-Service Gratuity Calculator
Calculate exactly what your employer owes you when your UAE employment ends. Based on Federal Decree-Law No. 33 of 2021 — the current UAE Labour Law, effective February 2022.
Gratuity Calculator
Enter your details below. Updates as you type.
Basic salary only — not the total. Excludes housing, transport, and other allowances.
Your fixed-term contract reached its end date and was not renewed.
Estimated gratuity
AED 24,500.00
Breakdown
Daily wage
AED 333.33
Total service
3.50 years
How UAE gratuity is calculated
UAE end-of-service gratuity is a lump-sum payment that every employer is required to pay an employee whose contract ends, provided the employee has completed at least one year of continuous service. The rules are set out in Articles 51 and 52 of the UAE Labour Law.
The formula in plain English
- Take your basic monthly salary (not the total — just basic).
- Divide by 30 to get your daily wage.
- For your first 5 years of service, you earn 21 days of basic salary per year.
- For every year after the 5th year, you earn 30 days of basic salary per year.
- The total cannot exceed 2 years of basic salary (24 months).
Worked example
An employee with a basic salary of AED 10,000 and 7 years of service:
- Daily wage: AED 10,000 ÷ 30 = AED 333.33
- First 5 years: 5 × 21 days = 105 days × AED 333.33 = AED 35,000
- Years 6–7: 2 × 30 days = 60 days × AED 333.33 = AED 20,000
- Total gratuity: AED 55,000
Who is entitled to gratuity?
Under the current UAE Labour Law, you are entitled to end-of-service gratuity if all of the following are true:
- You have completed at least 1 year of continuous service with the same employer.
- Your employment ended for any reason other than dismissal under Article 44 (gross misconduct).
- You worked under a private-sector contract governed by the UAE Labour Law (not a free-zone with its own labour regulations, such as DIFC or ADGM, which have separate rules).
The big change in the 2022 law: resignation no longer reduces your gratuity. Under the old unlimited-contract system, employees who resigned within the first 5 years received only one-third or two-thirds of the gratuity. That reduction has been abolished.
What counts as "basic salary"?
Your basic salary is the figure shown as "basic" or "basic wage" on your offer letter, labour contract, or monthly payslip. It excludes:
- Housing allowance
- Transport allowance
- Phone or communication allowance
- Education allowance for children
- Annual ticket allowance
- Performance bonuses or commissions
- Overtime payments
If you are unsure, ask your HR for a copy of your MOHRE labour contract — the basic salary is the figure listed in the wage breakdown.
Free zones with their own rules
Two UAE free zones operate under their own labour frameworks rather than the federal UAE Labour Law:
- DIFC (Dubai International Financial Centre) — has a separate end-of-service regime, including the DEWS (DIFC Employee Workplace Savings) plan which replaces traditional gratuity for many employers.
- ADGM (Abu Dhabi Global Market) — has its own employment regulations, broadly similar but with distinct rules.
Most other free zones — JAFZA, DMCC, Dubai Internet City, Dubai Healthcare City, etc. — follow the federal Labour Law, and this calculator applies.
When will your employer pay?
Article 53 of the Labour Law requires the employer to pay all end-of-service entitlements, including gratuity, within 14 days of the end of the contract. If your employer does not pay, you can file a complaint with the Ministry of Human Resources and Emiratisation (MOHRE) free of charge.
Frequently asked questions
What is end-of-service gratuity in the UAE?
End-of-service gratuity is a lump-sum payment your employer must pay you when your employment ends. It is a legal right under UAE Federal Decree-Law No. 33 of 2021, provided you have completed at least 1 year of continuous service and were not dismissed under Article 44 (gross misconduct).
How is gratuity calculated under the new UAE Labour Law?
For the first 5 years of service you receive 21 days of basic salary per year. For every year beyond 5 years, you receive 30 days of basic salary per year. The total gratuity is capped at 2 years' basic salary. The daily wage used is your basic monthly salary divided by 30.
Is gratuity calculated on basic salary or total salary?
Gratuity is calculated on your basic salary only. Allowances such as housing, transport, communication, and other benefits are excluded from the calculation. Always check your offer letter or labour contract — the basic salary is shown separately.
Do I get gratuity if I resign?
Yes. Under the new UAE Labour Law (effective February 2022), if you have completed at least 1 year of service and you resign, you are entitled to the full gratuity amount — there is no longer a reduced gratuity for resignation as there was under the old unlimited-contract system.
What if my employer dismisses me?
If you are terminated for any reason other than dismissal for cause under Article 44 (gross misconduct, fraud, etc.), you are entitled to your full gratuity. Article 44 dismissals — which require a formal investigation and procedure — result in forfeiture of gratuity.
Is there a maximum gratuity amount?
Yes. UAE Labour Law caps the total end-of-service gratuity at 2 years of your basic salary (24 months), regardless of how long you have worked for the same employer.
How are partial years calculated?
Partial years are pro-rated. If you served 3 years and 6 months, the calculation treats that as 3.5 years. The first 5 years use 21 days per year, so 3.5 years = 73.5 days of basic salary.
Are allowances ever included in gratuity?
No. Article 51 of the Labour Law is specific that gratuity is based on basic wage only. Some employment contracts may offer enhanced end-of-service benefits, but the legal minimum is calculated on basic salary alone.
Sources & references
- UAE Federal Decree-Law No. 33 of 2021 (Regulation of Labour Relations) — full text of the current Labour Law.
- Ministry of Human Resources and Emiratisation (MOHRE) — official UAE labour authority.
Disclaimer: This calculator provides estimates for general information only and is not legal advice. For decisions about your specific situation, consult a licensed UAE labour lawyer or your employer's HR department. See our full disclaimer.
Calculator built by Hafiz Hanif. Spotted an error? Email contact@dubaimoneymatters.com.