Free tool
UAE gratuity calculator
Estimate the end-of-service gratuity for a UAE mainland private-sector employee, in Dubai, Abu Dhabi or any other emirate. Enter the basic salary and the service dates to see the amount, the number of gratuity days, and the daily wage behind it.
Use the basic salary in the contract, not the total package. Gratuity is calculated on basic pay only.
How UAE gratuity is calculated
End-of-service gratuity in the UAE mainland private sector is set by the UAE labour law, Federal Decree-Law No. 33 of 2021, Article 51. For an employee who has completed at least one year of continuous service:
- 21 days of basic wage for each of the first five years of service.
- 30 days of basic wage for each year of service beyond five years.
- Part years count pro rata, so four and a half years earns four and a half years' worth.
- The total gratuity cannot exceed two years' wage.
- The daily wage is the monthly basic salary divided by 30.
For deductions, unpaid leave and how employers should provide for it, see our UAE gratuity employer guide and the employment guidance on the UAE Government portal.
Worked examples
Each figure below uses the same formula as the calculator above: gratuity days multiplied by the daily wage, capped at two years' wage.
| Basic salary | Service | Gratuity days | Estimated gratuity |
|---|---|---|---|
| AED 4,000 | 3 years | 63 (3 × 21) | AED 8,400 |
| AED 9,000 | 4.5 years | 94.5 (4.5 × 21) | AED 28,350 |
| AED 6,000 | 7 years | 165 (5 × 21 + 2 × 30) | AED 33,000 |
| AED 5,000 | 30 years | 855 (5 × 21 + 25 × 30) | AED 120,000Capped at two years' wage |
| AED 7,000 | 11 months | 0 | AED 0Under one year: none due |
Estimates for full-time, continuous service with no unpaid leave. The actual entitlement depends on the contract and the service record.
Resigning, leaving and the end of unlimited contracts
Under the old labour law, an employee who resigned from an unlimited contract could receive only a third or two thirds of their gratuity, depending on how long they had served. Those reductions were repealed. Under Federal Decree-Law No. 33 of 2021, private-sector contracts are fixed-term, and an employee who completes at least one year of continuous service earns gratuity on the same formula whether they resign or the contract ends another way, subject to the law's conditions and any lawful deductions.
What counts as the basic salary
Gratuity is calculated on the last basic wage in the employment contract, not the total package. Housing, transport, utilities and other allowances are left out, so two people with the same take-home pay can have very different gratuity if their contracts split basic pay and allowances differently. The figure that counts is the basic wage on the registered contract, which is why that split should reflect reality.
Unpaid leave, deductions and part-time work
Days of unpaid absence can reduce the service counted towards gratuity, so accurate attendance records matter. The employer can also set amounts the employee lawfully owes against the final settlement.
Part-time and flexible workers earn gratuity too, pro-rated to the hours they actually work against a full-time equivalent. The calculator assumes continuous full-time service with no unpaid leave, so treat its figure as the upper estimate where either applies.
When gratuity must be paid
Gratuity is paid with the rest of the final settlement when employment ends. The employer has 14 days from the end of the contract to pay the outstanding wages, other entitlements and gratuity.
MOHRE also runs a voluntary alternative to the lump sum, the end-of-service savings scheme, in which the amounts set aside for an employee's gratuity are invested in approved funds during the employment.
Where this calculator does not apply
The estimate is for the UAE mainland private sector. The DIFC and ADGM free zones run their own end-of-service arrangements, such as DIFC's DEWS savings plan; domestic workers are covered by a separate law; and government employees follow their own pension and gratuity rules.
For employers: provide for it every month
For an employer, gratuity is a liability that builds from an employee's first day, not a bill that arrives at the exit. Provide for it monthly on the basic wage and the final settlement is already funded. When tamdeed employs the people who work for you, the accrual is a line of its own on the charge sheet, set by law, so you can see it building. For the full budget picture, see how employers should provide for gratuity or estimate the loaded monthly cost of a hire.
Frequently asked questions
How is gratuity calculated in the UAE?
Under the current UAE labour law (Federal Decree-Law No. 33 of 2021), an employee with more than one year of continuous service earns 21 days of basic wage for each of the first five years, and 30 days of basic wage for each year after that. It is based on basic salary, and the total cannot exceed two years' wage.
Is gratuity based on basic salary or total salary?
Gratuity is calculated on the basic salary stated in the employment contract, not the total package. Allowances such as housing and transport are excluded.
How many days of gratuity do I get for each year?
21 days of basic wage for each of the first five years of service, and 30 days for each year after that. Part years count pro rata.
Is gratuity paid for less than one year of service?
No. An employee must complete at least one year of continuous service before any gratuity is due.
Is there a maximum gratuity in the UAE?
Yes. Total gratuity cannot exceed two years' wage, which the calculator applies as 24 months of basic salary.
Do I still lose gratuity if I resign?
No. The old reductions for resignation (one third or two thirds) applied under the previous law and were repealed. Under the current law an employee who completes at least one year is entitled to full gratuity, subject to lawful deductions.
When must gratuity be paid?
With the final settlement. The employer has 14 days from the end of the contract to pay the outstanding wages, other entitlements and gratuity.
Does this calculator cover DIFC and ADGM?
No. DIFC and ADGM operate their own end-of-service schemes (for example DIFC's DEWS savings plan), and domestic workers fall under a separate law. This estimate is for the UAE mainland private sector.
This calculator provides an estimate for the UAE mainland private sector based on basic salary and the current UAE labour law. It is not legal, tax, or financial advice, and does not account for every individual circumstance. DIFC, ADGM, and domestic-worker schemes differ. Confirm any figure with a qualified adviser or MOHRE.