If you work in the UAE private sector, you are owed an end-of-service gratuity when your job ends. Many people only find out how much at the last minute, or never check if the amount is right. Here is how it works, in plain English, with a real example.
Who gets gratuity?
You need at least 1 full year of continuous service with the same employer. If you worked less than 1 year, no gratuity is paid.
How much do you get?
- 21 days of basic salary for each of your first 5 years.
- 30 days of basic salary for each year after 5 years.
- Part years are paid pro-rata, for the part of the year you worked.
- Days of unpaid leave are not counted as service.
- The total cannot be more than 2 years of wages.
Basic salary, not total salary
Gratuity is based on your last basic salary only, not your allowances. Basic salary is shown on your contract and payslip and is often around 50% to 60% of your total pay.
A real example
Basic salary: AED 6,000 a month. Service: 7 years and 8 months.
- Daily basic wage: 6,000 / 30 = AED 200
- First 5 years: 5 x 21 x 200 = AED 21,000
- Remaining 2.73 years: 2.73 x 30 x 200 = about AED 16,405
- Total gratuity: about AED 37,405
When must it be paid?
Your employer should pay your final dues, including gratuity, within 14 days of your contract ending. Unused annual leave is paid separately on top of gratuity.
Check your own number in 1 minute
Our UAE Gratuity and Salary Planner works it out for you in Excel or Google Sheets. Type your joining date, last day and basic salary, and it shows your gratuity, your full final settlement, a monthly AED budget and your savings goals. Use code GULF30 for 30% off.
This is general information about UAE private sector rules under Federal Decree-Law No. 33 of 2021. Free zones such as DIFC and ADGM and government jobs can follow different rules. For a dispute, contact MOHRE.