UAE · guide
UAE gratuity law explained
End-of-service gratuity is a legal right for private-sector employees in the UAE, set out in Federal Decree-Law No. 33 of 2021 and administered by MOHRE. Here is what the law says, in plain terms.
Who qualifies
Any private-sector employee who completes at least one year of continuous service qualifies, whether they resign or are terminated. Time on unpaid leave is not counted toward service.
The formula
Gratuity is based on your last basic salary. The daily wage is basic salary divided by 30. You earn 21 days of basic salary for each of the first five years, and 30 days for each year after five. Partial years are paid pro-rata.
The two-year cap
No matter how long you have worked, total gratuity cannot exceed two years' basic salary.
Basic salary only
Gratuity uses basic salary as stated in your MOHRE contract. Housing, transport, and other allowances are excluded — a common source of disputes, so check your contract's basic figure.
Resignation vs termination
Under the current law, resignation no longer reduces gratuity. This changed the older system, which cut gratuity for employees who resigned early under unlimited contracts.
Free zones
Most of the UAE follows these federal rules, but DIFC (Dubai) uses the DEWS savings plan and ADGM (Abu Dhabi) offers a savings alternative, so free-zone employees should check their zone's scheme.
Estimate your own figure with the UAE gratuity calculator, or download the free Excel version from that page.
Questions
What law governs gratuity in the UAE?
Federal Decree-Law No. 33 of 2021, enforced by MOHRE, which took effect in February 2022.
Can an employer refuse to pay gratuity?
No. It is a statutory right and cannot be waived by contract. Employers must generally pay it within 14 days of the contract ending.
Does probation count toward gratuity?
Probation counts only if employment continues beyond it and you reach one full year of service.