UAE gratuity calculator

هذه الصفحة بالعربية

How UAE gratuity is calculated

Under Article 51 of Federal Decree-Law No. 33 of 2021, an employee who has completed at least one year of continuous service is entitled to end-of-service gratuity, calculated on their last basic salary:

• 21 days’ basic salary for each of the first five years of service.
• 30 days’ basic salary for each year beyond five.
• Part years count in proportion, and the total is capped at two years’ basic salary.

A day’s basic salary is the monthly basic divided by 30.

Worked examples

For an employee on a basic salary of AED 3,000.00 a month (a day is AED 100.00):

What this calculator doesn’t cover

• Unpaid leave and breaks in service. Periods that don’t count towards service change the length used. Adjust the dates to reflect them.
• Contract terms and alternative schemes. Employers can offer a voluntary alternative end-of-service scheme, and some free zones, such as DIFC, run their own. Check which applies.
• Other settlement items such as unused leave, notice pay and deductions.

Treat the result as a planning figure and confirm it against the employee’s contract and the current rules before paying.

Gratuity rules in the UAE at a glance

• Eligibility: at least one year of continuous service. Under a year, nothing accrues.
• Base: the last basic salary only, not allowances, commissions or overtime.
• Rate: 21 days of basic salary for each of the first five years, 30 days for each year after.
• Cap: two years of basic salary in total.
• Timing: payable within 14 days of the last working day.

The wider picture is in UAE gratuity rules and eligibility, and gratuity is one line of a final settlement.

Gratuity calculation in Dubai and Abu Dhabi

For mainland employees the same federal law applies in every emirate. A Dubai gratuity calculation and an Abu Dhabi one therefore give the same answer for the same salary and service, and this works as an end of service calculator for Dubai, Abu Dhabi, Sharjah and the rest of the UAE. Free zones are the exception: DIFC and ADGM, for example, have their own employment rules, and some employers offer an approved alternative scheme, so confirm which regime your employee falls under.

How to find your basic salary

Gratuity is worked out on basic salary alone, so the first thing to check is which part of your pay is basic. Look for the line marked basic salary on your contract, offer letter or payslip. Housing, transport, food and other allowances, commissions and overtime are separate and are left out. If your contract states one total only, ask HR for the basic component, because using the total gives a figure that is too high.

Gratuity in JAFZA, free zones and for domestic workers

Free zones. Many free zones, JAFZA among them, apply the federal labour law, so a JAFZA gratuity calculation uses the same formula as the mainland. DIFC and ADGM are the exceptions: each has its own employment rules and end of service arrangements. Confirm with your free zone authority or employer which regime applies before relying on a figure.

Domestic workers. Domestic workers are covered by a separate law, so this calculator is not the right tool for them. Check MOHRE’s guidance for the rules that apply.

Final settlement calculator: gratuity is one part

A final settlement is the total owed when someone leaves, and gratuity is only one line of it. The others are unpaid wages, pay for unused annual leave, any notice pay due and other contractual dues, less valid deductions. Use this calculator for the gratuity line, add the rest from the payroll record, and see what a final settlement includes for the full list.

MOHRE and the end of service figure

MOHRE, the Ministry of Human Resources and Emiratisation, administers UAE labour law (also written labor law). This calculator applies the formula in Decree-Law 33 of 2021, the same law MOHRE works from, but it is not a MOHRE tool. If an employee and employer disagree on the amount, the dispute normally starts with MOHRE, which looks at the contract, the wage record and the service dates, so keep all three.

How to calculate your own gratuity

1. Find your last monthly basic salary on your contract or payslip, ignoring allowances.
2. Enter your joining date and your last working day.
3. Read the result: the first five years at 21 days each, any further years at 30 days, and any cap.
4. Remember gratuity is only part of your final pay. See what a final settlement includes.

Gratuity belongs in payroll, not in a spreadsheet at exit

Gratuity builds up every month. For a manpower supplier with hundreds of workers, calculating it at the point of leaving is slow and error-prone, and the amount is due within 14 days. WPS payroll software that keeps basic salary and joining date on the employee record applies the same formula automatically. For the full rules, read how end-of-service gratuity is calculated in the UAE, and see how gratuity feeds your price in the manpower hourly rate calculator.