Gratuity Calculator UAE

Gratuity Calculator Dubai

If you’re working in the United Arab Emirates (UAE), understanding your end-of-service gratuity is essential. The Gratuity Calculator UAE helps you easily estimate how much compensation you are entitled to when you resign or your employment ends.

At GCalculate.com, our UAE Gratuity Calculator follows the official UAE Labour Law (Federal Decree Law No. 33 of 2021), ensuring your calculation is accurate and compliant. Whether you are a private-sector employee or working under a limited or unlimited contract, this tool helps you determine your end-of-service pay in seconds.

Gratuity is calculated on the basis of the last basic salary, ignoring allowances (like housing, transport). For both types of contracts, 1–5 years’ service gets 21 days’ basic salary per annum; more than 5 years, 30 days per annum, limited to two years’ salary. For unlimited contracts, resignation cuts gratuity: 1–3 years (1/3 of 21 days/year), 3–5 years (2/3 of 21 days/year), and full gratuity after five years. For example, minimum salary AED 5,000 for a 6-year service under a limited contract is AED 35,000 (5 × 21 × 5,000/30 + 1 × 30 × 5,000/30). Unpaid leave days are excluded.

What Is a Gratuity in the UAE?

Gratuity is a lump-sum payment given to employees at the end of their employment term as a reward for their service. It’s based on your basic salary and length of service. According to UAE Labour Law, every full-time employee who completes one year of continuous service is entitled to an end-of-service benefit, unless terminated for disciplinary reasons.

A gratuity calculator is an online tool that helps employees and employers estimate the end-of-service gratuity payment, a mandatory benefit under UAE Labour Law. This payment rewards employees for their service after completing at least one year of continuous work. Whether you’re on a limited (fixed-term) or unlimited (open-ended) contract, a gratuity calculator simplifies the process by using your basic salary and years of service to provide an accurate estimate.

In Dubai, gratuity rules are governed by UAE Federal Decree Law No. 33 of 2021 (updated in 2025), except in the Dubai International Financial Centre (DIFC), which follows a different system. With a gratuity calculator, you can avoid manual calculations and ensure compliance with the latest regulations.

How to Calculate Gratuity in UAE?

Gratuity is a mandatory end-of-service payment for UAE private sector employees under UAE Labour Law (Federal Decree-Law No. 33 of 2021). It’s based on basic salary, service years, and contract type (limited or unlimited).
Also Used: Overtime Calculation in UAE

Eligibility

• Complete 1+ year of continuous service.

• Not dismissed for gross misconduct (e.g., theft, fraud).

• Excludes government workers, domestic workers, DIFC/ADGM employees.

Calculation Rules

• Basic Salary: Excludes allowances, bonuses, commissions.

• Service Years: Prorate partial years (e.g., 3 years, 6 months = 3.5).

• Cap: Maximum 2 years’ basic salary.

Contract Types:

• Limited: Fixed-term, forfeiture if resigning early (1–5 years).
• Unlimited: Open-ended, reduced gratuity if resigning.

Formulas

Unlimited Contract:

• 1–5 years: (Basic Salary / 30) × 21 × Years
• Over 5 years: (Basic Salary / 30) × 30 × Years Beyond 5

Resignation Penalty:

• 3–5 years: 2/3 gratuity.
• Over 5 years: 1/3 gratuity.
• Employer termination: Full gratuity.

Limited Contract:

• Same as unlimited, but resignation before contract end (1–5 years) forfeits gratuity.
• Partial Years: (Basic Salary / 30) × 21 (or 30) × (Months / 12)

Example

• Basic Salary: AED 6,000/month

• Service: 6 years, unlimited contract

Resignation:

• First 5 years: (6,000 / 30) × 21 × 5 = AED 21,000
• Year 6: (6,000 / 30) × 30 × 1 = AED 6,000
• Total: 21,000 + 6,000 = AED 27,000
• Penalty: 27,000 × 1/3 = AED 9,000
• Termination: Full AED 27,000

Who is Eligible for Gratuity in Dubai?

To qualify for gratuity:

• You must complete at least one year of continuous service.
• You must be employed in the private sector (UAE nationals may have different schemes).
• Expatriate workers are fully entitled.

You may not receive gratuity if:

• You resign before completing one year.
• You’re dismissed for gross misconduct (per Article 120 of UAE Labour Law).
• You resign without proper notice (except in specific cases).

Gratuity Calculator Dubai is a free, easy-to-use tool designed to help employees and HR professionals in Dubai, UAE, calculate end-of-service benefits (gratuity) based on the UAE Labour Law and Dubai-specific regulations, including free zones like DIFC and JAFZA. Whether you’re resigning, being terminated, or planning HR compliance, this calculator provides accurate estimates of your gratuity entitlement.

Frequently Asked Questions (FAQs)

How is gratuity calculated in the UAE?

It’s based on your basic salary and years of service — 21 days per year for the first 5 years, and 30 days per year after 5 years.

Who is eligible for gratuity in the UAE?

Any employee completing at least one year of continuous service is entitled to gratuity, except those dismissed for disciplinary reasons.

Is gratuity based on total or basic salary?

Only basic salary is considered for gratuity — allowances and bonuses are excluded.

How soon is gratuity paid after resignation?

Employers must pay the gratuity within 14 days after the employee’s final working day.

Can I use the calculator for part-time or contract jobs?

Yes, the calculator can estimate gratuity for part-time or flexible workers, based on proportional working hours.