Gratuity Calculator UAE
Use this gratuity calculator UAE to work out your exact end-of-service benefits. Enter your basic salary and service dates to see what you are owed under current UAE Labour Law.
About This Tool
What Is End of Service Gratuity?
End of service gratuity is a legal lump sum paid to an employee when their job ends in the Private Sector. It is not a bonus. It is a statutory right protected by the Ministry of Human Resources and Emiratisation (MOHRE).
This calculator uses the exact formula outlined in Federal Decree-Law No. 33 of 2021. It applies the correct daily wage multiplier based on your years of service. No data is stored. All math runs in your browser.
(Basic Salary / 30) x 21 x Years(Basic Salary / 30) x 30 x Additional YearsRelated Calculators
Other UAE Employment Tools
How It Works
How to Calculate Your UAE Gratuity
Many people incorrectly use their total package. The law only uses your Basic Salary. Here is the exact method recognized by UAE labour courts.
Find Your Basic Salary
Check your employment contract. Do not include housing, transport, or other allowances. Only the basic pay counts.
Calculate Your Daily Wage
Divide your monthly basic salary by 30. This gives your daily wage, which is the base number for the formula.
Apply the Correct Multiplier
Multiply the daily wage by 21 days for the first 5 years of service. Multiply it by 30 days for every year after that.
Add Pro-Rata for Partial Years
Count your total service time. Any incomplete year is calculated Pro-Rata. You get credit for every extra month and week worked.
Calculation Examples
See the Formula in Action
These examples show the actual math this tool performs. Both assume the employee has completed at least one year of Continuous Service.
Common Scenarios
When to Use This Tool
Resigning From Your Job
Find out exactly what you are owed before you hand in your notice. Under current UAE Labour Law, you are entitled to full benefits after one year.
Facing Termination
If your employer ends your contract, calculate your final settlement to make sure the offered amount matches the legal requirement.
Ending a Limited Contract
When a fixed term contract expires and is not renewed, you are entitled to your end of service payment based on your last drawn basic salary.
Checking HR Calculations
Employers sometimes make errors by using gross salary instead of basic, or by ignoring pro-rata months. Verify their math independently.
Eligibility Rules
Who Gets Gratuity in the UAE?
Under Article 51 of the employment decree, any private sector employee who completes at least one year of service is eligible. This includes both expatriates and UAE nationals not covered by the General Pension and Social Security Authority.
Many outdated calculators show reduced gratuity for resigning on an unlimited contract. This is based on the old law. Under current UAE Labour Law, resignation no longer reduces your entitlement. You receive the full amount after completing one year of service.
Resignation vs Termination Entitlements
The reason for leaving only affects your payout if you are dismissed for Gross Misconduct. Here is how different exit scenarios compare.
| Exit Scenario | Service Required | EOSB Entitled? | Notes |
|---|---|---|---|
| Voluntary Resignation | 1 year or more | Full | Full entitlement under current law |
| Employer Termination | 1 year or more | Full | Must be paid within 14 days |
| End of Fixed Term | 1 year or more | Full | Applies to limited contracts |
| Gross Misconduct | Any | No | Employer must prove the dismissal |
| Under 1 Year Service | Under 1 year | No | No statutory entitlement |
Terminated employees must receive their full end of service payment within 14 days of their last working day. If an employer delays, they can be reported to MOHRE.
Calculation Factors
What Counts as Basic Salary for Gratuity?
The most common mistake employees make is using their total monthly package. The law is strict. Only your basic salary counts. Gross salary includes allowances, which are legally excluded from the formula.
| Salary Component | Included in EOSB? | Reason |
|---|---|---|
| Basic Monthly Pay | Yes | Core compensation stated in contract |
| Housing Allowance | No | Classified as a separate benefit |
| Transport Allowance | No | Classified as a separate benefit |
| Commissions or Bonuses | No | Variable pay is excluded |
Always check your employment contract. Some companies list a high total salary but allocate a very low basic salary to reduce their end of service liability.
The 24-Month Cap Explained
There is a maximum limit on how much gratuity you can receive. The total amount cannot exceed 24-Month Cap of your basic salary. This rule applies regardless of how many years you work for the company. If your calculated total crosses this limit, your payout is capped at exactly two years of basic pay.
Impact of Unpaid Leave
Days of unpaid leave are removed from your total service period. This reduces your final calculation. Make sure you account for any extended absences when estimating your payout.
Free Zone Rules
Gratuity Rules for DIFC, ADGM, and Free Zones
Mainland UAE Labour Law does not apply to every zone. Many free zones follow their own employment regulations, which changes the math completely.
DIFC Employees
DIFC operates under a completely separate legal framework. They use the Defined Contribution End-of-Service Savings Scheme instead of the traditional lump sum. Employers pay monthly into a regulated fund.
ADGM Employees
Similar to DIFC, ADGM has its own employment regulations. Their end of service calculations differ from the mainland MOHRE formula.
Other Free Zones
Zones like JAFZA, DMCC, and DDA generally follow the mainland UAE Labour Law for gratuity. However, you should always verify your specific free zone regulations with your HR department.
Special Categories
Are Domestic Workers Eligible for Gratuity?
Yes. Under UAE law, domestic workers including nannies, drivers, and cooks are eligible for end of service benefits. They must complete at least one year of continuous service.
The calculation uses the same 21-day formula for the first five years. Workers hired through agencies may have their end of service handled differently depending on who holds the legal employment contract.
This calculator provides estimates based on standard interpretations of UAE Labour Law. It does not constitute legal advice. Actual payouts may vary based on contract terms, free zone regulations, or specific employment circumstances. For formal disputes, consult a UAE-licensed lawyer or contact MOHRE directly.
Frequently Asked Questions
UAE Gratuity FAQs
Gratuity is calculated using your basic salary divided by 30 to get a daily rate. For the first five years, you get 21 days per year. For any years beyond five, you get 30 days per year. Under the new law, resignation no longer reduces this amount if you have completed one year of service.
Gratuity is calculated strictly on your basic salary. Gross salary includes housing, transport, and other allowances, which are legally excluded from the end of service formula. Only the basic pay figure on your contract applies.
You must complete at least one continuous year of service. Employees who leave before completing 12 months are not entitled to any statutory end of service benefits under current UAE Labour Law.
No. DIFC operates under a separate employment law. They use a Defined Contribution savings scheme where employers pay monthly into an investment fund, rather than paying a lump sum based on the 21 or 30 day formula at the end of service.
The total gratuity payout cannot exceed 24 months of your basic salary. Even if your total years of service would result in a higher calculation, the employer is legally only required to pay up to this two-year cap.
No. If you resign before completing one full year of continuous service, you lose your right to end of service benefits. The one-year rule is mandatory regardless of your contract type.
The daily wage is calculated by dividing your monthly basic salary by 30. For example, a basic salary of AED 9,000 gives a daily wage of AED 300. This daily rate is then multiplied by 21 or 30 depending on your years of service.
If an employee is terminated for gross misconduct, the employer can legally deny the gratuity payment. The employer must prove the misconduct, and the employee can challenge this through MOHRE or the Labour Court.
Days of unpaid leave are deducted from your total service period. This means your final years of service calculation will be slightly lower, which reduces the final gratuity amount owed to you.