How UAE gratuity is calculated
Under Article 51 of Federal Decree-Law 33 of 2021, an employee with at least one year of continuous service is entitled to:
| Service | Gratuity per year |
|---|---|
| Years 1–5 | 21 days of basic salary |
| Year 6 onwards | 30 days of basic salary |
Daily basic wage = monthly basic salary ÷ 30. Part years are pro rata, unpaid absence is excluded, and the total is capped at two years’ wage. Gratuity must be paid within 14 days of the contract ending.
Worked examples
7 years’ service, AED 10,000 basic salary
- First 5 years: 5 × 21 × 333.33 = AED 35,000
- Next 2 years: 2 × 30 × 333.33 = AED 20,000
- Total gratuity: AED 55,000
3 years’ service, AED 6,000 basic salary
- 3 × 21 × 200 = AED 12,600
Under one year: no gratuity is due.
What’s not included
Gratuity doesn’t include unpaid salary, leave encashment or notice pay; those are settled separately in the final settlement. Use the leave salary calculator for unused leave. Emirati employees registered with GPSSA receive a pension instead of gratuity. Employers who joined the voluntary alternative end-of-service savings scheme pay monthly contributions instead. See the UAE payroll guide.