UAE gratuity calculator

How the law works it out

Article 51 of Federal Decree-Law No. 33 of 2021 sets the gratuity for a full-time foreign worker in the private sector. In short:

• One year first. You need “a year or more in continuous service” before any gratuity is due (51.2). Under one year, the law gives none.
• 21 days a year for the first five years. A wage of 21 days for each of the first five years of service (51.2a).
• 30 days a year after that. A wage of 30 days for each year beyond five (51.2b).
• Part years count. Once you have completed a year, part of a year is paid in proportion (51.3).
• Unpaid days are left out. Days of unpaid absence are not counted in your service (51.4).
• Your last basic wage. The gratuity uses the last basic wage you were entitled to (51.5).
• A limit. The whole gratuity cannot be more than two years’ wage (51.6).
• Deductions. Your employer may deduct only “amounts that are due by law or by a judgment”, under the conditions in the law’s Implementing Regulation (51.7).

Resigning does not reduce it. The current law has no rule that cuts gratuity because you resign; the old 1980 law did. Article 51 has one formula whatever the reason the contract ends, and deductions are limited to amounts due by law or a court judgment (51.7). The u.ae guidance lists no reduction for resigning either: a worker with more than one year but less than five “is entitled to full gratuity pay based on 21 days’ salary for each year of work”. One exception for older contracts: a transitional rule (Article 68(3)) let employers apply the 1980 law’s rules for open-ended contracts while contracts moved to fixed terms. If your contract started before February 2022 and was never converted, check with MOHRE.

To turn that into money, this calculator uses Article 67, which says that for this law a year is 365 days and “the month represents (30) thirty days”. So a day’s basic wage is your monthly basic wage divided by 30, and your years of service are your days of service divided by 365. The UAE government’s guidance page on u.ae also describes the gratuity as 21 and 30 “days’ salary”.

Worked example

This example is ours, worked from Article 51. Neither the law nor the Ministry of Human Resources and Emiratisation (MOHRE) publishes one.

A worker’s last basic wage is AED 3,000 a month. They worked 2,555 days (7 years of 365 days) with no unpaid absence.

Daily basic wage (3,000 / 30)

AED 100.00

First 5 years (21 days x 5 x 100)

AED 10,500.00

Next 2 years (30 days x 2 x 100)

AED 6,000.00

Two-year limit (24 x 3,000)

AED 72,000.00

Estimated gratuity

AED 16,500.00

The limit does not apply here. On basic wage alone, it is only reached after about 25.5 years of service.

What counts as basic wage

Article 1 of the law defines two kinds of pay:

• Basic wage is the wage in your employment contract, paid monthly, weekly, daily, hourly or by piece, without “any other allowances or benefits in-kind”. The gratuity is worked out on this.
• Wage is the basic wage plus the cash allowances and benefits in kind in your contract, such as allowances for the cost of living or a percentage of sales or profits.

The u.ae guidance gives examples of what is left out of the gratuity: housing, transportation, utilities and furniture allowances. Check your contract and payslip for the line called basic salary or basic wage, and enter that figure.

The two-year limit in Article 51(6) is on “wage”, which includes allowances. The calculator reads two years’ wage as 24 times your monthly wage. If you fill in your full monthly wage, it uses that for the limit. If you leave it empty, it uses your basic wage, which gives a lower limit.

Who this calculator does not cover

• Domestic workers. Household workers are covered by a different law, Federal Decree-Law No. 9 of 2022. Its Article 22 leaves the rules for their end-of-service benefit to the UAE Cabinet, so this calculator does not cover domestic workers. Check your standard contract and ask MOHRE. Contacts for Filipino domestic workers are in our UAE guide.
• Free zones with their own employment law. The Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) have their own laws and end-of-service rules: DIFC Employment Law Article 66 and ADGM Employment Regulations section 61. Both work out a day’s basic wage by dividing by 365, and DIFC pays gratuity only for service before its workplace savings scheme started. Workers there should use their zone’s rules.
• Dubai Development Authority (DDA) zones. DDA’s own gratuity calculator says the DDA Free Zone “is governed by the Dubai Technology and Media Free Zone Employment Regulations 2004” and the federal law, and that its result is a sample with “no legal merit”. If you work in a DDA zone, use DDA’s official calculator and check with DDA.
• Part-time and other work patterns. The Implementing Regulation works these out by the share of full-time hours. This calculator is for full-time staff only.
• Piecework. The law uses an average daily wage for workers paid by piece. This calculator does not.
• The Savings Scheme. Employers can join a voluntary scheme under Cabinet Resolution No. 96 of 2023 and pay 5.83% or 8.33% of basic salary into a fund instead. Gratuity built up before joining is still worked out under the law.
• UAE nationals, whose end-of-service benefit follows the UAE’s pension laws (51.1).

The calculator also leaves out amounts your employer may deduct under the law or a court judgment (51.7), unpaid wages, leave pay and notice pay.

If you and your employer disagree

The u.ae guidance says employers must pay outstanding wages, other dues and the gratuity within 14 days of the contract ending. This page cannot tell you what your employer has to pay you: only your contract, your records and MOHRE can. The UAE government’s page on resolving labour disputes explains how to raise a complaint with the Ministry of Human Resources and Emiratisation (MOHRE). Its Labour Claims and Advisory Call Centre is on 80084, toll-free in the UAE. The Migrant Workers Office (MWO) of the Philippine Embassy or Consulate can also help Filipino workers. The MWO contacts in Abu Dhabi and Dubai are in our UAE guide.

u.ae’s end-of-service page sets out the rules but gives no calculator or worked example.

What to do with your gratuity

A plain order to think about, as information only:

1. Keep a cash buffer for the months between jobs or after you come home. The emergency fund calculator works out how much.
2. Bring your SSS and Pag-IBIG up to date, so the years abroad count toward your pension. See the SSS guide for OFWs and the Pag-IBIG guide.
3. Look at the government savings options, such as Pag-IBIG MP2, and the other choices in our investing guides.

Moving a large sum home? See sending money home for how fees and exchange rates work. The working abroad hub has the full order for saving on an overseas salary.

Working elsewhere in the Gulf

Saudi Arabia, Qatar and Kuwait each set end-of-service pay in their own labour law, with different rules.

See the Saudi end of service calculator.

Mango & Umbrella is independent. We are not part of, or endorsed by, the UAE Ministry of Human Resources and Emiratisation (MOHRE) or any UAE or Philippine government agency.