UAE Labour Law Gratuity Calculator
Calculate your UAE end-of-service gratuity payout based on the latest UAE Labour Law regulations.
UAE End-of-Service Gratuity Calculator
Calculate your UAE Labour Law end-of-service gratuity payout. Accurately models the 21 days (years 1-5) and 30 days (years 5+) rules under modern limited contract regulations.
💼 Employment & Salary Details
MoHRE Statutory Calculation Summary
How UAE Labour Law End-of-Service Gratuity (ESG) Payouts Work
In the United Arab Emirates (UAE), foreign expatriate employees in the private sector are entitled to an End-of-Service Gratuity (ESG) lump-sum payout upon completing their employment contract.
1. Basic Salary vs. Gross Allowances
Gratuity calculations are strictly based on your **Basic Monthly Salary** as stated in your official MoHRE employment contract. Housing allowances, transport stipends, overtime pay, and performance bonuses are legally excluded from the calculation.
2. Statutory MoHRE Gratuity Rates
- Less than 1 Year: No gratuity entitlement.
- 1 to 5 Years of Service: 21 days of basic salary for each year served.
- More than 5 Years of Service: 30 days of basic salary for each additional year served after Year 5.
Worked Example: AED 15,000 Basic Salary Payout Comparison
| Service Length | Tier 1 Days (21 Days) | Tier 2 Days (30 Days) | Total Gratuity Payout |
|---|---|---|---|
| 3 Years | 63 Days | 0 Days | AED 31,068 |
| 5 Years | 105 Days | 0 Days | AED 51,780 |
| 8 Years | 105 Days | 90 Days | AED 96,164 |
Frequently Asked Questions (FAQ)
Is there a difference in gratuity if I resign vs if I am terminated?
Under Federal Decree-Law No. 33 of 2021, the distinction between resignation and termination reduction penalties has been abolished for standard limited contracts. Full gratuity applies after 1 year.
What is the maximum gratuity payout allowed under UAE law?
The maximum total end-of-service gratuity payout cannot exceed **24 months (2 years) of basic salary**.
Educational Purpose Disclaimer
This calculator is provided for informational and educational estimation purposes only. All calculations and projections are based on standard mathematical formulas and assumed inputs. The output values should not be considered professional financial, legal, tax, or medical advice. ProCalc is not a registered financial advisor or licensed practitioner. Always consult a qualified professional (such as a Chartered Accountant, certified planner, or physician) before making major decisions.
What is the UAE Labour Law Gratuity Calculator?
The UAE Labour Law Gratuity Calculator is an end-of-service benefits planner designed for expatriate employees and employers in Dubai, Abu Dhabi, and the wider UAE to compute severance settlements according to the latest federal guidelines.
In the United Arab Emirates, expatriate workers are not part of the national social security pension system. Instead, under UAE Federal Decree-Law No. 33 of 2021 (the UAE Labour Law), they are entitled to an End of Service Gratuity paid by the employer upon contract termination or resignation.
To qualify for a gratuity payout, you must complete at least 1 year of continuous service with your employer. The payout is calculated using your last basic salary (excluding allowances like housing, transport, or utilities):
• First 5 Years of Service: You are entitled to 21 days of basic salary for each year of service.
• Service Exceeding 5 Years: You are entitled to 30 days of basic salary for each additional year of service.
• Maximum Legal Cap: The total gratuity payment is legally capped at a maximum of 2 years (24 months) of basic salary.
Under the unified employment contract system, there are no longer differences in payouts between limited and unlimited contracts, nor are there any arbitrary reductions applied if you choose to resign. Days of unpaid leave are excluded from the service duration calculation.
This calculator computes your continuous service duration in years and days, applies the 21-day and 30-day salary multipliers, verifies that your payout falls within the 2-year legal cap, and displays your final estimated gratuity settlement.
How Does the UAE Labour Law Gratuity Calculator Work?
1. Input your monthly basic salary. 2. Input total years of continuous service. 3. View your estimated gratuity payout and maximum legal cap limits.
Formula & Calculation Method
Calculates gratuity as 21 days of basic salary per year for the first 5 years of service, and 30 days per year for any service exceeding 5 years. Total payout is capped at 2 years of basic salary.
Example Calculation
Basic salary AED 10,000, 6 years service. First 5 years = 5 * 21/30 * 10k = AED 35,000. Year 6 = 1 * 30/30 * 10k = AED 10,000. Total Gratuity = AED 45,000.
Frequently Asked Questions
Calculates gratuity as 21 days of basic salary per year for the first 5 years of service, and 30 days per year for any service exceeding 5 years. Total payout is capped at 2 years of basic salary.
Disclaimer: This tool is provided for informational and calculation purposes. Output values are estimates based on standard user inputs.