UAE Gratuity Calculator 2026
Calculate your end-of-service entitlement accurately under the latest UAE Labour Law.
✅ Aligned with Federal Decree-Law No. 33 of 2021 · ✅ MOHRE-approved formula · ✅ Free · ✅ Data never stored
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How UAE Gratuity Is Calculated (Article 51, Federal Decree-Law No. 33 of 2021)
UAE end-of-service gratuity is a legal right for every private sector employee who completes at least one year of continuous service. The calculation is based on your basic salary only — not your total package — and follows a tiered structure defined in Article 51 of Federal Decree-Law No. 33 of 2021.
First 5 Years: 21 Days of Basic Salary Per Year
For each completed year of service up to five years, you are entitled to 21 calendar days of basic salary.
Formula: (Basic Salary ÷ 30) × 21 × Years of Service (up to 5 years)
Above 5 Years: 30 Days of Basic Salary Per Year
For every additional year beyond the first five, the rate increases to 30 calendar days of basic salary per year.
Formula: (Basic Salary ÷ 30) × 30 × Years of Service (above 5 years)
What Counts as Basic Salary?
Gratuity is calculated on your basic salary only. The following are excluded:
| Included ✅ | Excluded ❌ |
|---|---|
| Basic monthly salary | Housing allowance |
| Transport allowance | |
| Meal or food allowance | |
| Sales commissions & bonuses | |
| Overtime payments |
Tip: Check your payslip for the figure labelled “Basic Salary” — this is the number to enter in the calculator above.
The Maximum Gratuity Cap (2 Years’ Basic Salary)
No matter how long you have worked, your total gratuity cannot exceed two years’ basic salary. For example, if your basic salary is AED 10,000 and you worked 25 years, the calculated amount would be AED 270,000 — but the cap limits it to AED 240,000 (AED 10,000 × 24 months).
UAE Gratuity Calculation Formula — Worked Example
Basic salary: AED 10,000 | Service: 7 years | Contract: Unlimited | Departure: Termination by employer
Step 1 — First 5 years (21 days/year): (10,000 ÷ 30) × 21 × 5 = AED 35,000
Step 2 — Remaining 2 years (30 days/year): (10,000 ÷ 30) × 30 × 2 = AED 20,000
Total Gratuity: AED 55,000
Termination by employer entitles you to the full gratuity amount regardless of contract type.
Limited vs. Unlimited Contract: Key Differences for Gratuity
| Limited Contract | Unlimited Contract | |
|---|---|---|
| Resignation — full gratuity? | ✅ Always full | Depends on years served (see table below) |
| Termination by employer | ✅ Full gratuity | ✅ Full gratuity |
| Contract expiry | ✅ Full gratuity | N/A |
| Minimum service for gratuity | 1 year | 1 year |
Since Federal Decree-Law No. 33 of 2021, most UAE private sector contracts are limited (fixed-term). If your contract has a fixed end date, you are almost certainly on a limited contract and entitled to full gratuity even if you resign. See our guide: Limited vs. Unlimited Contracts — Which Gives More Gratuity?
Resignation Gratuity Reduction Rules (Unlimited Contracts)
If you are on an unlimited contract and resign, the amount you receive depends on your years of service:
| Years of Continuous Service | Gratuity Entitlement on Resignation |
|---|---|
| Less than 1 year | ❌ No gratuity |
| 1 to 3 years | 1/3 (one-third) of full gratuity |
| 3 to 5 years | 2/3 (two-thirds) of full gratuity |
| More than 5 years | ✅ Full gratuity |
A Note on Free Zone Employees
If you work in a UAE free zone, your end-of-service entitlement may follow different rules:
- DIFC: Operates the DEWS (Employee Workplace Savings) scheme — a mandatory savings plan that replaces traditional gratuity.
- ADGM: Has its own employment regulations and end-of-service benefit framework.
- DMCC, JAFZA, and most other free zones: Follow UAE Federal Labour Law — the same calculation applies.
Read our full guide: How to Calculate Gratuity in Dubai Free Zones (DMCC, JAFZA)
Why Trust This Calculator?
- Law-aligned formula: Implements Article 51 of Federal Decree-Law No. 33 of 2021 exactly — the same law MOHRE enforces.
- Updated for 2026: Reflects the latest Ministry of Human Resources and Emiratisation (MOHRE) guidance.
- Covers all mainstream scenarios: Limited and unlimited contracts, resignation, termination, and contract expiry.
- Basic salary basis: Correctly uses basic salary (not gross salary), matching the legal requirement.
- Private sector focus: Designed for employees under UAE Federal Labour Law.
- No data stored: All calculations run in your browser. Your salary and dates are never sent to or stored on our servers.
ℹ️ This tool provides an estimate for information purposes only. It is not legal advice. For disputes, contact MOHRE or a qualified UAE employment lawyer.
Frequently Asked Questions
Is my probation period included in gratuity?
Yes — once you successfully complete probation and continue with the same employer, the probation period counts towards your total service duration for gratuity purposes. However, if you leave the company during probation, you are not entitled to any gratuity.
Does unpaid leave affect gratuity?
Yes. Any period of unpaid leave is deducted from your total service duration, reducing your final gratuity amount. For example, if you worked 5 years but took 60 days of unpaid leave, your effective service period is approximately 4 years and 10 months. Approved paid leave (annual leave, sick leave, maternity leave) does not reduce your gratuity.
What if I have worked for less than 1 year?
No gratuity is payable if your total continuous service is less than one full year (365 days). Once you cross the one-year mark, gratuity is calculated pro-rata for partial years — for example, 2 years and 6 months earns 2.5 years’ worth of gratuity.
Is gratuity based on full salary or basic salary only?
Basic salary only. Article 51 explicitly states that gratuity is calculated on your last basic wage, not your total package. Housing allowance, transport, commissions, bonuses, and overtime are all excluded. Always use the “Basic Salary” figure on your payslip. Read our detailed guide.
What if I work part-time?
Part-time employees are entitled to gratuity on a pro-rata basis, in proportion to their working hours. The same Article 51 rates apply but the daily rate reflects the part-time basic salary. Read our part-time gratuity guide.
Do free-zone rules change my gratuity?
It depends on the free zone. Most UAE free zones follow Federal Labour Law and the standard calculation applies. However, DIFC uses the DEWS savings scheme and ADGM has its own framework. Check your contract or ask HR to confirm. Read our Free Zone Gratuity Guide.
When must my employer pay my gratuity?
Your employer must pay all end-of-service entitlements within 14 days of your last working day. If they fail to do so, file a complaint via the MOHRE portal at mohre.gov.ae or call 800 60.
What if my employer refuses to pay my gratuity?
Non-payment of gratuity is illegal. Steps: (1) Raise it in writing with your employer. (2) File a complaint via the MOHRE portal or call 800 60. (3) If unresolved, MOHRE refers the case to the labour court. Full step-by-step guide here.
Does a salary increase affect my gratuity?
Yes. Gratuity is calculated on your last basic salary at the time of leaving. A salary increase in your final year applies to the entire calculation, which can meaningfully increase your total gratuity amount.
Is housing allowance included in gratuity in the UAE?
No. Housing allowance is excluded from the gratuity calculation under UAE Labour Law. Only your basic salary is used. This is the most common source of miscalculation — always use the basic salary figure from your payslip or employment contract.
Can I get gratuity if I resign on an unlimited contract?
Yes, but the amount depends on years served: 1–3 years = one-third of full gratuity; 3–5 years = two-thirds; over 5 years = full gratuity. On a limited contract, you always receive full gratuity on resignation (after 1 year). See the resignation reduction table above.
Does gratuity form part of my final settlement?
Yes. Your final settlement typically includes: gratuity, accrued unused annual leave (leave encashment), outstanding notice period salary, and any other contractual payments. Gratuity is usually the largest component. Read our leave encashment guide.
Related UAE Labour Law Guides
- 📖 UAE Labour Law Article 51: A Deep Dive for Employees — The exact legal text and what it means for your entitlement.
- 📖 Limited vs. Unlimited Contracts — Which Gives More Gratuity? — Side-by-side comparison with worked examples.
- 📖 Understanding Basic Salary vs. Gross Salary — Avoid the most common gratuity calculation mistake.
- 📖 How to Calculate Gratuity in Dubai Free Zones (DMCC, JAFZA) — Rules for mainland vs. free zone employees.
- 📖 What to Do If Your Employer Refuses to Pay Gratuity — Your MOHRE options explained step by step.
- 📖 Calculating Leave Encashment Along With Gratuity — How to calculate your total final settlement.
- 🌎 GCC Gratuity Calculators — Saudi Arabia, Qatar, Kuwait, Bahrain & Oman end-of-service calculators.