UAE Labour Law ยท Article 51
Your end-of-service benefit, to the dirham
21 days of basic pay for each of the first five years, 30 days for every year after โ calculated on your basic salary, not your total package.
Basic only โ exclude housing, transport and other allowances.
Gratuity is due after at least one full year of service.
Estimated gratuity
35,507 AED
How it works
The calculation, step by step
Daily wage = basic salary ร 12 รท 365. Multiply by 21 days for each of your first five years, then 30 days for every additional year. Part years count pro-rata, resignation no longer reduces the entitlement under the 2022 Labour Law, and the total is capped at two years of basic salary. Unpaid absence days can be excluded from the service period.
Beyond the basic formula
Gratuity Q&A
Does it matter if I resign or I'm terminated?
No โ since the 2022 Labour Law unified the rules, gratuity is calculated the same way whether you resign or are terminated (with notice), as long as you've completed at least one year of service. The old "resignation reduces your gratuity" scale from the pre-2022 law no longer applies.
What if I'm dismissed for gross misconduct?
Gratuity can be forfeited entirely if dismissal falls under the law's narrow list of serious-misconduct grounds (e.g. proven fraud, serious safety breaches). This is a high bar โ ordinary performance issues don't qualify. See the Labour Law Q&A for the termination rules.
Is unpaid leave counted in my years of service?
No โ unpaid leave days are generally excluded when calculating your total service period, which can slightly reduce your gratuity years versus your total employment duration.
How is a partial final year calculated?
Pro-rata โ if you complete 6 years and 6 months, the 6 months count as half a year's worth of the applicable daily rate (21 or 30 days depending on which bracket you're in).
Does gratuity apply in free zones?
Most free zones follow the standard federal formula. Two notable exceptions: DIFC and ADGM replaced gratuity with defined-contribution savings schemes (DIFC's DEWS) โ employers pay monthly into a fund instead of a lump sum at exit.
What if my employer refuses to pay?
Unpaid gratuity is one of the most common MOHRE complaints. File via MOHRE (800-60 or the app) โ wage and end-of-service disputes get a fast-track mediation process, and unresolved cases move to the Labour Court.
Is gratuity taxed?
No โ there's no personal income tax in the UAE, so your full gratuity and settlement amount is paid without deduction.
For the full picture โ notice periods, termination grounds, leave โ see the complete Labour Law Q&A, or calculate your full final settlement including leave encashment.