UAE Gratuity Calculator (End of Service Benefits)

How it works

Gratuity = (years ≤ 5) × 21 × basic/30 + (years > 5) × 30 × basic/30, pro-rated for part years, capped at 24 × basic salary

Under the 2022 UAE Labour Law every private-sector employee who completes a year of service is owed an end-of-service gratuity on leaving, calculated on the final basic salary only — housing, transport and other allowances are excluded. The rate is 21 days’ basic pay for each of the first five years and 30 days for each year after, with fractions of a year paid pro rata and days of unpaid leave excluded. The total cannot exceed two years’ basic pay. Unlike the old law, resignation no longer reduces the entitlement for unlimited contracts, and employers must pay within 14 days of the end date. Employees in DIFC and ADGM, and those enrolled in the voluntary savings scheme, follow different rules.

Worked example

Basic AED 12,000, about 6.5 years of service: daily wage 400; 5 × 21 × 400 = 42,000 plus 1.5 × 30 × 400 = 18,000 → roughly AED 60,000, comfortably under the AED 288,000 cap.

Frequently asked questions