UAE gratuity calculator (end-of-service benefit)

Gratuity is the lump sum a UAE private-sector employer owes a foreign employee when the job ends. It is set by Article 51 of Federal Decree-Law No. 33 of 2021, the Labour Law that replaced the 1980 law on 2 February 2022. The calculation itself is short. Most wrong answers come from using the wrong salary, the wrong day rate or rules that were repealed years ago.

The rule in Article 51

Article 51 of Federal Decree-Law 33/2021 says a full-time foreign worker who has completed at least one year of continuous service is owed an end-of-service gratuity on leaving. Its parts:

• Rate (Art. 51(2)). 21 days of basic wage for each of the first five years, and 30 days of basic wage for each year after the fifth.
• Minimum service (Art. 51(2) and (3)). Nothing is owed until one full year of continuous service. After that, a part year is paid in proportion to the time worked.
• Unpaid days (Art. 51(4)). Days of unpaid absence are not counted as service. Article 33(2) says the same for unpaid leave.
• Which salary (Art. 51(5)). The last basic wage. Article 1 defines basic wage as the contract wage without allowances or benefits in kind. Piece-rate workers use their average daily wage over the last six months (Art. 23).
• Cap (Art. 51(6)). The total may not be more than two years’ wage.
• Deductions (Art. 51(7)). The employer may only deduct amounts the worker owes under the law or a court judgment.
• Calendar (Art. 67). A year is 365 days and a month is 30 days. This fixes both the day rate and how part years are counted.

UAE nationals are not covered by this gratuity: Article 51(1) refers them to pension and social security law.

How to work it out, step by step

1. Count your days of service. Count from your first working day to your last, including both days. Then subtract any unpaid leave or unpaid absence days. The calculator does the count from the two dates.
2. Check you have a year. If what remains is under 365 days, the gratuity is zero. Stop here.
3. Turn days into years. Divide by 365. Three years to the day is 1,095 ÷ 365 = 3.
4. Count gratuity days. Multiply up to 5 of those years by 21, and any years beyond 5 by 30. Eight years gives 5 × 21 + 3 × 30 = 195 days.
5. Find your daily basic. Divide your monthly basic salary by 30. AED 12,000 basic gives AED 400 a day.
6. Multiply. Gratuity days × daily basic. 195 × 400 = AED 78,000.
7. Apply the cap. If the result is more than 24 months of basic, cut it to 24 months of basic.

That is everything the law asks for. Notice pay, leave pay and unpaid salary are separate entitlements. They sit alongside the gratuity in a final settlement, not inside it.

Gratuity by years of service

The table uses a basic salary of AED 10,000 a month, so the daily basic is AED 333.33. Scale it to your own basic: at AED 5,000 halve every figure, at AED 20,000 double it.

Gratuity on a basic salary of AED 10,000 a month

Service	Days of basic	Gratuity
1 year	21	AED 7,000.00
2 years	42	AED 14,000.00
3 years	63	AED 21,000.00
4 years	84	AED 28,000.00
5 years	105	AED 35,000.00
6 years	135	AED 45,000.00
7 years	165	AED 55,000.00
8 years	195	AED 65,000.00
9 years	225	AED 75,000.00
10 years	255	AED 85,000.00
15 years	405	AED 135,000.00
20 years	555	AED 185,000.00
25 years	705	AED 235,000.00
30 years	855	AED 240,000.00

Up to five years the gratuity grows by 21 days (AED 7,000 here) a year. From the sixth year it grows by 30 days (AED 10,000 here) a year. The cap of 24 months’ basic (AED 240,000 here) is reached at 25.5 years. Thirty years would come to 855 days, AED 285,000, so the 30-year row is cut back to AED 240,000.

Worked examples

Each example below is one of the test cases the calculator is checked against, so the calculator gives the same figures.

Three years on a basic of AED 10,000

If those three years include 29 February 2024, the date count is 1,096 days, which is 3.0027 years under the 365-day year in Article 67. The gratuity becomes AED 21,019.18. The calculator follows the law’s calendar, so a leap day counts like any other day worked.

Eight years on a basic of AED 12,000

Eight years is 2,920 days. The first five years give 5 × 21 = 105 days and the next three give 3 × 30 = 90 days, 195 days in all. At AED 400 a day (12,000 ÷ 30) that is 105 × 400 = AED 42,000 plus 90 × 400 = AED 36,000, a gratuity of AED 78,000.00.

A year and a half on a basic of AED 9,000

548 days of service is 548 ÷ 365 = 1.5014 years. Because the first full year is complete, the extra half year counts in proportion: 1.5014 × 21 = 31.53 days. At AED 300 a day the gratuity is AED 9,458.63. A calculator that drops the part year would show AED 6,300, and one that rounds up to two years would show AED 12,600. Neither is what Article 51(3) says.

Three years with 40 days of unpaid leave, basic AED 8,000

26 years on a basic of AED 15,000: the cap

Twenty-six years is 105 days for the first five plus 21 × 30 = 630 days for the rest, 735 days in all. At AED 500 a day that is AED 367,500. The cap of two years’ wage cuts it back.

Ten months on a basic of AED 7,000

300 days of service is under one year, so the gratuity is AED 0. The same applies to anyone who leaves during probation before completing a year. Once you pass 365 days the first year counts in full. Before that, leaving means no gratuity at all.

Part-time, four years at half hours, basic AED 6,000

Article 52 and Cabinet Resolution 1/2022 Article 30 pay part-time workers the full-time gratuity in proportion to their contract hours. Four years full time would be 84 days × AED 200 = AED 16,800. At half the full-time hours the gratuity is AED 8,400.00. Open “More options” in the calculator to enter your share of full-time hours.

Resigning, being dismissed and the old 1980 rules

Under Decree-Law 33/2021 the reason the job ended does not change the gratuity. Article 51 has no reduction for resignation and no difference between contract types. The three-year example above is AED 21,000 whether the employee resigned or was let go. The calculator asks how the job ended only so it can confirm this on the receipt.

Article 45 lists cases where a worker may leave without notice, and says the worker keeps their end-of-service rights. A dismissal without notice under Article 44 does not, on its own, cancel the gratuity under Article 51.

Much of what is still repeated about gratuity comes from Federal Law No. 8 of 1980, which Article 73 of the new law repealed. As commonly reported (we could not read the 1980 text on an official portal, so treat this as history, not law):

• the 21-day and 30-day rates and the two-year cap were the same
• on an unlimited contract, a worker who resigned got one third of the gratuity after 1 to 3 years, two thirds after 3 to 5 years, and the full amount after 5 years
• on a limited contract, a worker who resigned before 5 years got nothing

So a calculator still using the 1980 rules would show AED 7,000 instead of AED 21,000 for the three-year example if the worker resigned.

There is one legacy case. Article 68 required employers to convert old unlimited contracts to fixed-term ones within a year of 2 February 2022. Article 68(3) then allows an employer to calculate end-of-service benefits for such contracts under the 1980 unlimited-contract rules. If you started on an unlimited contract before 2022 and resigned, check what your contract became.

Basic salary or total salary?

Basic only. Article 51 uses the last basic wage, and Article 1 separates basic wage (the contract wage “not including any other allowances or benefits in kind”) from wage (basic plus allowances). Your contract or payslip normally shows the split.

The difference can be large, because allowances are often a big share of UAE pay. On a package of AED 16,000 with a basic of AED 10,000, three years gives AED 21,000 on basic. Working on the full package would give AED 33,600, which is AED 12,600 more than the law requires. It is “last” basic too. If your basic rose last year, the whole gratuity uses the new figure, not an average.

If a contract gives no basic wage at all, Article 22(1) leaves the question to the court. We do not guess a basic figure.

Unpaid leave, sick leave and part-time work

Only unpaid days come off your service. Annual leave, paid sick leave, maternity leave and public holidays all count as service.

Part-time and job-sharing workers get the full-time figure scaled by their contract hours (Art. 52). Temporary work of less than a year earns no gratuity (Cabinet Resolution 1/2022 Art. 30).

The two-year cap

Article 51(6) says the total gratuity may not be more than “two years’ wage”. The law does not say whether that means 24 monthly salaries or 730 days of pay. Most calculators silently use 24 months. We use it too, as the dataset behind this page does, and say so. The other reading uses Article 67’s 365-day year, which gives 730 days × daily basic, about 24.33 months.

The difference only matters after about 25.5 years of service. At that point it is worth a third of a month’s basic. Choose the reading under “More options” in the calculator to see both.

Who this calculator does not cover

• UAE nationals. Covered by pension and social security law instead (Art. 51(1)).
• Federal and local government employees, the armed forces, police and security services. Article 3(2) puts them outside the Labour Law.
• Domestic workers (housemaids, nannies, drivers employed by a household). They fall under Federal Decree-Law No. 9 of 2022, not the Labour Law (Art. 3(2)(c)). Article 22 of that law says the Cabinet “may approve the systems and mechanisms for calculating and paying” their gratuity. We found no Cabinet resolution that does so, and the executive regulations (Cabinet Decision 106/2022) are silent on it. So the 21/30-day formula on this page does not apply to them, and we do not know of a formula in force. The 14 days a year that some pages quote came from the 2017 law that Decree-Law 9/2022 replaced. What the 2022 law does set: unused leave is paid out and the employer must settle within 10 days of the contract ending (Art. 19(9)).
• DIFC. Since 1 February 2020 DIFC employers pay into the DIFC Employee Workplace Savings plan (DEWS) instead of a gratuity: 5.83% of monthly basic for employees with under five years’ service and 8.33% after that.
• ADGM. ADGM has its own Employment Regulations. Law-firm commentary on the 2024 Regulations (in force from 1 April 2025) says gratuity is now paid whatever the reason for leaving and the two-year cap has gone. We have not read the enacted text, so we do not calculate ADGM gratuity.
• Other free zones such as DMCC, JAFZA and most non-financial zones follow the federal Labour Law, so this calculator applies.

When it must be paid and what can be taken off

The employer must pay all end-of-service dues, gratuity included, within 14 days of the contract ending (Art. 53). The calculator prints that date under the result. You have two years from the end of employment to bring a claim (Art. 54(9), as amended by Federal Decree-Law 9/2024).

If you are not paid, the route is a labour complaint to MOHRE. Since the 2024 amendment to Article 54, MOHRE can issue a final decision itself on claims up to AED 50,000.

The employer may deduct only what the law or a judgment allows (Art. 51(7) and Cabinet Resolution 1/2022 Art. 29):

• loans and overpaid wages
• pension or insurance contributions
• penalties approved under the employer’s disciplinary rules
• debts ordered by a court
• the cost of damage the worker caused by their own fault

Deductions for penalties or damage must be made within three months of the date they fell due, unless agreed otherwise.

The optional savings scheme

Since 1 November 2023, Cabinet Resolution 96/2023 has let private-sector employers move staff to an alternative end-of-service savings scheme instead of the Article 51 gratuity (the legal basis is Art. 51(8)). It is voluntary for the employer. The employer pays 5.83% of monthly basic each month for employees with under five years’ service and 8.33% from five years on. Employees may add their own contributions of up to 25% of their total wage. Gratuity earned before an employee joins the scheme is kept, calculated on service up to the date of joining.

If your employer enrolled you, this calculator covers only your service before enrolment.

Mistakes other gratuity calculators make

While researching this page we checked the method behind calculators and HR guides that rank for gratuity against the law. These are the errors we found most often. We do not name the sites. Use the list to check any figure you have been given.

• Dividing by 365 days instead of 30. Some tools and payroll guides work out the day rate as basic × 12 ÷ 365. Article 67 fixes the month at 30 days, so the day rate is basic ÷ 30. On a basic of AED 10,000 the ×12/365 rate is AED 328.77 instead of AED 333.33. Three years then comes to AED 20,712.33 instead of AED 21,000.00.
• Applying the 1980 resignation cuts. One third or two thirds for resignation, or nothing on a limited contract, is the old law. For a three-year employee who resigned this shows AED 7,000 instead of AED 21,000.
• Using total salary. Working on the full package instead of basic overstates the gratuity: AED 33,600 instead of AED 21,000 in the example above.
• Dropping or rounding part years. Article 51(3) pays part years in proportion once one year is done. 548 days is 1.5 years, not 1 or 2.
• Counting unpaid leave as service. Article 51(4) excludes it.
• Using the 21/30-day formula for domestic workers. They are under a different law, which sets no formula yet.
• Not saying how the cap is read. “Two years’ wage” can be read two ways. A good calculator tells you which one it uses.

How this calculator counts

• Service days are calendar days from the first working day to the last, both included, minus unpaid days.
• Years are service days ÷ 365. The day rate is monthly basic ÷ 30. Both come from Article 67.
• Each tier is rounded to the fils and the total is the sum of the rounded tiers, so the receipt always adds up. This can differ from an unrounded calculation by one fils.
• The cap defaults to 24 months of basic. Part-time scaling is applied after the cap.
• Every figure the calculator uses (21 days, 30 days, five years, 365 days, the 30-day month and the 24-month cap) is read from the dataset listed in the sources. Each one was last checked against the law on 30 October 2026.

For the rest of what you are owed when you leave (unused leave, notice pay and salary still due), use the final settlement calculator. It uses this page’s gratuity calculation as one of its lines.