Private-sector employees in the UAE earn an end-of-service gratuity instead of a state pension. Under Federal Decree-Law No. 33 of 2021, it's based on your last basic salary and your length of service, and since 2022 it no longer matters whether you resign or are let go. This calculator applies the Article 51 formula, including part-years and the two-year cap. Rules checked September 2026.
Figures checked against UAE Federal Decree-Law No. 33 of 2021, Article 51. Prices and rules change, so confirm with the official source before relying on them.
How it works
Divide your monthly basic salary by 30 to get a daily wage. You earn 21 days of that wage for each of your first five years of service, and 30 days for each year after that. Part-years count in proportion once you've completed the first full year.
Only basic salary counts. Housing, transport and other allowances, bonuses, commission and overtime are excluded, which is why gratuity is often much lower than people expect. Check the basic figure on your MOHRE-registered contract.
Under the old law, resigning could cut gratuity by a third or two thirds. The 2021 law removed that: after at least one year of continuous service, you get the full amount whether you resign or the employer ends the contract. Service under one year earns nothing, and dismissal for serious misconduct can forfeit it.
The total can't exceed two years' wage. It rarely matters: at 21 then 30 days a year, it takes well over two decades of service to reach it. Employers must pay end-of-service dues within 14 days of the contract ending.
A worked example
With a basic salary of AED 10,000 a month after 6 years, the daily wage is AED 333.33. The first five years earn 5 × 21 = 105 days (AED 35,000) and the sixth year earns 30 days (AED 10,000), a gratuity of AED 45,000, whether you resign or not.
Questions people ask
How is gratuity calculated in the UAE?
Daily wage = monthly basic ÷ 30. Multiply by 21 days for each of the first five years and by 30 days for each year after, adding part-years in proportion. The total is capped at two years' wage.
Do I get gratuity if I resign?
Yes, in full, if you've completed at least one year of continuous service. The resignation reductions from the old labour law no longer apply to contracts under Federal Decree-Law No. 33 of 2021.
Is the housing allowance included in gratuity?
No. UAE gratuity is calculated on basic salary only. That's different from Saudi Arabia, where the end-of-service award uses the full wage including fixed allowances.
When must my employer pay gratuity?
Within 14 days of the end of the contract, together with other final dues such as unpaid salary and leave. If it's late or disputed, you can file a complaint with MOHRE.
Does this apply in DIFC, ADGM or free zones?
Not always. DIFC employers use a workplace savings scheme instead of gratuity, and some free zones have their own rules. Domestic workers are covered by a separate law. Check which rules your employer is under.
Guides
- Saudi End of Service After Resignation: One Third, Two Thirds or Full?Resigning in Saudi Arabia reduces your end-of-service award depending on how long you've worked. Here are the Article 85 tiers, the exceptions, and worked examples.
- Do Freelancers Pay Corporate Tax in the UAE? The AED 1 Million TestUAE corporate tax only reaches freelancers once business turnover passes AED 1 million a year, and then only profit above AED 375,000 is taxed at 9%. Here's how to check.
- Do You Get Gratuity If You Resign in the UAE? The 2026 RulesUnder the UAE's current Labour Law, resigning no longer cuts your end-of-service gratuity. Here's how it's calculated, what counts as basic salary, and when it's paid.