UAE gratuity calculator for end of service
Enter the basic salary and the service dates. The calculator applies the current rule: 21 days of basic wage for each of the first five years, 30 days for every year after that, capped at two years of wage.
How UAE gratuity works
Who is entitled to gratuity?
Any full-time private-sector employee who completes at least one year of continuous service. Less than one year: no gratuity. Fractions of a year after the first year are paid pro rata.
Is it calculated on basic salary or total salary?
On the basic wage only. Housing, transport and other allowances are excluded. The daily rate is the monthly basic wage divided by 30, so 21 days equals 70% of one month's basic and 30 days equals one full month.
Do I lose gratuity if I resign?
No. The 2022 law removed the old reductions for resignation on unlimited contracts. Resignation and termination now earn the same gratuity once a year of service is complete.
What is the maximum?
The total is capped at two years of wage, which is 24 months of basic salary. The calculator applies the cap automatically and tells you when it bites.
Do unpaid leave days count?
No. Days of unpaid absence are removed from the service period. Paid annual leave and sick leave count normally.
DIFC, ADGM and the savings scheme
DIFC and ADGM run their own end-of-service systems (DIFC uses the DEWS plan). Employers who enrolled staff in the voluntary savings scheme pay through the fund instead. This calculator covers the federal Labour Law.
Gratuity is one line on the payslip. Xrero does the whole payslip.
Salaries from contracts and attendance, gratuity accruals, the WPS SIF file for your bank, leave and payslips in Arabic and English. AED 99 per user per month, setup done for you.
See Xrero HR & Payroll Ask on WhatsAppHow the gratuity rule is applied, step by step
End-of-service gratuity in the UAE is set by the Labour Law in force since February 2022 (Federal Decree-Law 33 of 2021, Article 51). The calculator above follows it exactly; this is what it does with your numbers.
1. Who is entitled
A full-time foreign employee who completes at least one year of continuous service. UAE and GCC nationals are covered by their pension schemes instead of gratuity. Part-time and other work models earn gratuity in proportion to their working hours.
2. The wage the rule uses
Only the last basic wage counts. Housing, transport and other allowances are excluded, so a contract that puts most of the pay into allowances produces a smaller gratuity than one with the same total and a higher basic.
3. The rate
21 days of basic wage for each of the first five years of service, and 30 days of basic wage for each year after the fifth. After the first year, fractions of a year are paid pro rata. A daily wage is the monthly basic divided by 30.
4. The cap and the deductions
The total can never exceed two years of basic wage. Days of unpaid leave are not counted as service. The employer may deduct amounts the employee legally owes, and must pay the gratuity within 14 days of the last working day.
5. Resignation
Under the 2022 law a full-time employee who resigns after one year receives the full gratuity for the service completed. The older rule that reduced gratuity on resignation no longer applies to full-time contracts.
A worked example
Basic wage AED 6,000 per month, seven years and six months of service. The daily wage is AED 200. The first five years earn 21 days a year: 21 x 200 x 5 = AED 21,000. The next two and a half years earn 30 days a year: 30 x 200 x 2.5 = AED 15,000. Gratuity due: AED 36,000, well under the cap of two years of basic wage (AED 144,000).
Free zones with their own employment law, such as DIFC and ADGM, run end-of-service savings schemes instead, and employers under the federal law may join the voluntary savings scheme introduced in 2023; the FAQ below covers both.
Page updated 8 September 2026.