End-of-service gratuity becomes a problem when the final settlement is delayed, the amount is calculated on a lower “basic salary” than expected, unpaid leave or service dates are counted differently, or payment is made conditional on signing documents quickly. In these situations, one rushed signature or an unclear waiver can reduce leverage and make it harder to challenge the numbers later.
This guide helps employees and employers calculate gratuity correctly under Article 51, identify common dispute traps, estimate the amount using an embed-ready UAE gratuity calculator, review worked examples (2–8 years), prepare the evidence that typically decides outcomes, and understand the practical steps to take if gratuity is not paid—plus FAQs targeting Dubai/UAE gratuity calculator questions.
What Is End-of-Service Gratuity in the UAE?
End-of-service gratuity is a mandatory lump-sum payment for private-sector employees who complete at least one year of continuous service, designed to support employees transitioning between jobs.
Key Points:
- Pro-rata Payment: If leaving mid-year, calculated proportionally for that year.
- Eligibility: Minimum 1 year of continuous service; applies to fixed-term, unlimited, full-time, part-time, and some flexible contracts.
- Calculation: Based on last basic salary only (allowances excluded).
- Service Up to 5 Years: 21 days’ basic salary per year.
- Service Beyond 5 Years: 30 days’ basic salary per additional year.
- Maximum Limit: Total gratuity cannot exceed two years’ wages. Deductions allowed for outstanding debts.
- Resignation vs Termination: Payable in both cases, but amount may differ.
- No Gratuity: Not payable if dismissed for cause (misconduct or breach of duty).
Does UAE Gratuity Law Apply to You? (Mainland vs Free Zones)
UAE gratuity law covers most private-sector expatriate employees with at least one year of continuous service. Under the 2022 Labour Law, it is a mandatory end-of-service benefit, calculated at 21 days’ basic salary per year for the first five years, and 30 days per year for each additional year.
Before using any calculator, confirm the governing regime:
- Mainland + most free zones (MOHRE / Federal Labour Law): follow the federal framework described on the UAE government portal.
- DIFC: end-of-service gratuity for expatriates was replaced by DEWS/qualifying schemes (different benefit structure).
- ADGM: has its own employment regulations/rulebook approach (not a MOHRE-style gratuity page).
Important: The calculator below is designed for MOHRE/federal private-sector gratuity (Article 51) only.
| Jurisdiction | Gratuity Law Applies? | Key Notes | Governing Authority / Reference |
|---|---|---|---|
| Mainland UAE | ✅ Yes | Standard MOHRE Article 51 rules; federal labour law applies | MOHRE / Federal Decree-Law No. 33 of 2021 |
| Most Free Zones | ✅ Yes (federal framework usually applies) | Follow MOHRE rules unless free zone has specific provisions | MOHRE / Federal Labour Law |
| DIFC | ⚠️ Limited / Modified | DEWS (Defined End-of-Service) scheme or other qualifying plans; different calculation | DIFC Employment Law / DEWS regulations |
| ADGM | ⚠️ No (separate rules) | Own employment regulations; no MOHRE-style gratuity | ADGM Employment Regulations / ADGM Rulebook |
| Domestic Workers | ❌ No | Gratuity not covered under MOHRE private-sector rules; separate domestic worker law applies | MOHRE Domestic Worker Service |
Key Points on UAE Gratuity:
- Eligibility: Minimum 1 year of continuous service.
- Calculation: Based on last basic salary (excludes allowances).
- Resignation vs. Termination: Payable after 1 year of service in both cases.
- Limit: Cannot exceed 2 years’ salary.
- Alternative Schemes: Some sectors use DEWS or investment-based schemes; pre-enrollment benefits remain the employer’s responsibility.
- Tip: Use MOHRE-approved calculators for accurate, up-to-date estimates.
UAE Gratuity Calculator (Article 51)
In the UAE, end-of-service gratuity is based on last drawn basic salary (excluding allowances) and length of service, provided the employee has completed at least one year.
Key Gratuity Rules (UAE Labour Law):
- 1–5 Years of Service: 21 days’ basic salary per year.
- Above 5 Years: 30 days’ basic salary per year for each year beyond five, plus 21 days for the first five years.
- Maximum Limit: Total gratuity cannot exceed 2 years’ salary.
- Salary Basis: Only basic salary counts; housing, transport, and other allowances are excluded.
- Pro-rata Calculation: Partial years are calculated proportionally.
Calculator Inputs
- Monthly basic salary (AED)
- Start date + end date
- Optional: unpaid leave days (excluded from service count)
- Output: gratuity estimate + years/days breakdown + cap warning
UAE Gratuity Calculator (Article 51 – MOHRE/Federal)
Calculates gratuity on basic salary using Article 51 (21 days/year for first 5 years, then 30). Estimates only—confirm governing regime (DIFC/ADGM differ).
Legal basis: Article 51 uses basic wage and a two-tier days-per-year method. Government guidance also notes gratuity increases to 30 days/year after 5 years and is subject to a cap.
Step-by-step formula
- Confirm you’re under MOHRE/federal private-sector rules.
- Confirm basic salary (not total package).
- Confirm continuous service is 1+ year.
- Calculate daily basic wage (commonly basic ÷ 30).
- Apply Article 51 days-per-year:
- 21 days per year for first 5 years
- 30 days per year after 5 years
- Apply any applicable cap (official guidance notes a cap; verify against your regime and payroll records).
Worked Worked Examples: Calculating UAE End-of-Service Gratuity
To help you understand how UAE gratuity is calculated, here are practical examples based on different lengths of service and a basic salary of AED 10,000. These examples show step-by-step calculations using the daily basic salary and applicable gratuity days.
Example 1: 3 years, basic salary AED 10,000
- Daily basic: 10,000 ÷ 30 = 333.33
- Gratuity days: 21 × 3 = 63
- Gratuity: 333.33 × 63 ≈ AED 21,000
Example 2: 8 years, basic salary AED 10,000
- First 5 years: 21 × 5 = 105 days
- Next 3 years: 30 × 3 = 90 days
- Total days: 195
- Gratuity: 333.33 × 195 ≈ AED 65,000
If the basic salary used looks wrong, gratuity is withheld until you sign, or your exit is being labeled misconduct, a short document review usually protects your final settlement position before you escalate.
Ensure your gratuity is calculated correctly and protect your rights. For disputes, settlement reviews, or guidance on resignation/termination agreements:
Review Settlement Wording: Contract Law
Labour & Employment Advice: Labour & Employment Lawyer
Gratuity Dispute Scenarios (What Usually Goes Wrong + What To Do Next)
End-of-service gratuity disputes rarely happen because employees don’t qualify — they happen because of calculation errors, rushed settlements, or technical misunderstandings during exit. In many cases, the pressure to sign a “full & final” settlement leads employees to waive legitimate claims without reviewing the numbers carefully.
Before you agree to any final settlement, understand the common pressure points employers use — and the smart steps you should take to protect your rights.
Scenario 1: Employer Withholds Gratuity Until You Sign “Full & Final”
What happens: HR offers a quick settlement but ties payment to signing a broad waiver.
Risk: You may waive claims (unpaid salary, leave balance, notice pay, or a higher gratuity calculation).
Do next (employee):
- Request a written breakdown of: basic wage used, service period counted, unpaid leave deductions, leave balance, and final settlement items.
- Don’t sign until the numbers match your payroll proof.
- If you need a settlement wording review, route it through
https://alramsyadvocates.com/services/contracts/(Contract Law).
Scenario 2: “Basic Salary” Used Is Lower Than Reality
What happens: The calculation uses a basic salary figure that doesn’t match payslips or contract.
Legal anchor: Article 51 calculates gratuity based on the basic wage (not allowances).
Do next:
- Collect payslips + bank/WPS proof + the signed contract wage clause.
- If your payslips show a different basic than HR’s figure, that’s your dispute lever.
Scenario 3: Service Period Counted Incorrectly (Unpaid Leave / Gaps)
What happens: HR reduces your gratuity by excluding time you believe should count.
Legal anchor: Article 51 states days of absence without pay are not included in the service duration calculation.
Do next:
- Pull attendance records + leave approvals + HR emails/WhatsApp confirming leave type.
- Separate “approved unpaid leave” from “paid leave” in your evidence pack.
Scenario 4: “Resignation vs Termination” Confusion Becomes a Leverage Play
What happens: The exit is pushed as “resignation” (or framed as misconduct) to reduce leverage and speed signature.
Do next:
- Keep exit communications written (date-stamped).
- Preserve any messages suggesting pressure, threats, or sudden narrative changes.
Scenario 5: Your Contract Is DIFC (DEWS) but You’re Using a MOHRE Calculator
What happens: People use mainland calculators while employed under DIFC.
Reality: DIFC replaced the traditional end-of-service gratuity for expatriates with DEWS/qualifying schemes from Feb 2020.
Do next:
- Check the contract jurisdiction (DIFC vs mainland).
- If DIFC applies, stop using MOHRE/Article 51 calculators and switch to the DIFC scheme logic.
What Article 51 Actually Says (High-Utility Summary)
Article 51 states (for foreign full-time workers):
- Eligibility after 1+ year of continuous service
- Calculation on basic wage
- 21 days per year for the first 5 years
- 30 days per year for years beyond 5
- Pro-rata for parts of a year (after completing one year)
- Unpaid leave days are excluded from the service duration calculation
Evidence Checklist (This Is What Wins Most Gratuity Disputes)
Gratuity disputes are rarely decided by emotion — they’re decided by documentation. Whether you’re an employee challenging a calculation or an employer defending one, the outcome usually depends on how complete and organized your evidence file is.
Before escalating to MOHRE or entering settlement discussions, make sure your paperwork is complete, consistent, and aligned with UAE labour law requirements.
If You’re an Employee
- Employment contract + any amendments
- Payslips showing basic salary (not just total)
- Bank statements / WPS confirmations
- Start date / end date proof (offer letter, MOHRE contract copy if available)
- Leave records (especially unpaid leave approvals)
- Exit documentation (resignation/termination letter, settlement draft, HR emails/WhatsApp)
If You’re an Employer / HR
- Contract + wage structure evidence + payroll/WPS proof
- Attendance + leave approvals + unpaid leave tracking (clean audit trail)
- Settlement breakdown sheet (line-by-line)
- Any deductions justification (documented and lawful)
If you’re preparing for a labour complaint or reviewing a settlement, consider structured legal labour lawyer guidance before proceeding
How to Claim Gratuity If It’s Not Paid (MOHRE Route — Practical)
Under UAE Labour Law, employers must settle all end-of-service dues — including gratuity — within 14 days from the last working day. If payment is delayed or refused, you should take immediate, documented action.
Steps to Claim Unpaid Gratuity
If your employer fails to pay your gratuity within the legal timeframe, follow these structured steps to formally claim your entitlement and escalate the matter properly:
1- Send a Formal Written Demand
Start by submitting a written request to HR or management. Your letter should include:
- Your resignation or termination date
- Your total period of service
- A clear calculation of the gratuity amount due
Keep a copy of the email or letter for your records.
2- File a Complaint with MOHRE
If your employer ignores or rejects your request, file a complaint with the Ministry of Human Resources and Emiratisation (MOHRE) through:
- MOHRE website
- MOHRE mobile app
- Call center: 600 590 000
3- Prepare the Required Documents
Gather supporting evidence before filing:
- Employment contract
- Salary slips (showing basic salary)
- Visa cancellation documents
- Bank statements (if needed)
- Written communication requesting payment
Strong documentation significantly improves your position during mediation.
4- Mediation and Labour Court Referral
MOHRE will first attempt to resolve the dispute through mediation.
If no settlement is reached, MOHRE will issue a referral letter allowing you to file a case before the UAE Labour Court.
5- Consider Legal Representation
If the dispute involves calculation disagreements, deductions, or contested termination grounds, consulting a UAE labour lawyer can help protect your claim.
Key Legal Points to Remember
- Eligibility: Gratuity applies after completing at least one year of continuous service.
- Calculation:
- 21 days of basic salary per year for the first 5 years
- 30 days of basic salary per year after 5 years
- Payment Deadline: All end-of-service dues must be paid within 14 days of termination.
Do This Today (Before You Resign or Sign Anything)
Gratuity disputes are often won or lost before a complaint is ever filed. Whether you are exiting as an employee or processing a final settlement as HR, taking preventive steps now can protect you from costly errors, delayed payments, or legal escalation later.
If You’re an Employee
- Save: contract + payslips + bank/WPS proof + leave records
- Write your own timeline (dates + amounts)
- Ask for a written settlement breakdown
- Don’t sign a waiver until the calculation matches your evidence
If You’re an Employer / HR
- Verify the basic wage used matches payroll records
- Confirm unpaid leave days are recorded correctly
- Issue a written breakdown and keep a clean file for MOHRE review
End-of-Service Gratuity – Frequently Asked Questions
How Is Gratuity Calculated in the UAE?
Under Article 51 for foreign full-time workers, gratuity is calculated on basic wage: 21 days/year for the first 5 years, then 30 days/year thereafter, with pro-rating after 1+ year.
Is Gratuity Based on Basic Salary or Total Salary?
Article 51 states the gratuity is calculated according to the basic wage, not allowances.
Do I Get Gratuity If I Resign in the UAE?
Eligibility and calculation depend on your regime and facts (mainland MOHRE vs DIFC/ADGM), and on proving service and basic wage. Article 51 establishes eligibility after 1+ year for eligible foreign full-time workers.
How Much Gratuity for 5 Years in the UAE?
If eligible under Article 51, 5 years is typically calculated at 21 days of basic wage per year (total 105 days of basic wage), subject to evidence and cap.
Is There a MOHRE Gratuity Calculator?
There are official and publisher calculators in the UAE market, but the safest approach is verifying your basic wage and service record against Article 51 and your payroll evidence.
Does DIFC Use the Same Gratuity Rules?
DIFC replaced the traditional end-of-service gratuity for expatriates with the DEWS/qualifying scheme model from Feb 2020.
Gratuity issues escalate quickly once formal complaints begin. Whether you are reviewing your final settlement or preparing documentation for a claim, taking structured legal steps early can significantly improve your outcome.
If you need guidance on gratuity calculations, settlement wording, or labour complaint strategy, seek professional review with our labour lawyer before signing or filing. Early clarity often prevents lengthy disputes later.
