Financial Education · UAE Private Sector
UAE gratuity calculator: what your end-of-service benefit is worth.
Under Federal Decree-Law No. 33 of 2021, a UAE private-sector employee with at least one year of service earns 21 days of basic salary for each of the first five years and 30 days for each year after, calculated on the last basic wage and capped at two years' pay. Enter your figures below to see yours.
By the Vault Wealth Team · Reviewed by Bilal Abou-Diab, CFA · Rules as at October 2026
01The calculator
How much gratuity will I get?
Three figures give you the statutory estimate. The fourth is optional and shows what the gratuity is worth against your whole pay, allowances included.
Your estimate
Estimated gratuity
Service counted
One day's basic wage
Monthly basic ÷ 30
Another year of service adds
At today's basic salary
How it adds up
This is an estimate of the statutory minimum under Article 51 of Federal Decree-Law No. 33 of 2021 for mainland private-sector employment. It does not account for contractual terms more favourable than the law, deductions for sums owed to the employer, part-time arrangements, or the alternative savings scheme under Cabinet Resolution No. 96 of 2023. Your employer's final settlement is the binding figure. Nothing is stored or sent: the calculation runs in your browser.
02The rules
How is gratuity calculated under UAE labour law?
Article 51 of the Labour Relations Law sets the formula, and Cabinet Resolution No. 1 of 2022 fills in the detail. Six rules do almost all the work.
| Rule | What the law says | What it means in practice |
|---|---|---|
| Eligibility | One year or more of continuous service | Leave at 11 months and there is no statutory gratuity |
| Years 1 to 5 | 21 days of basic wage per year | Five full years earn 105 days, about 3.5 months of basic pay |
| Year 6 onward | 30 days of basic wage per year | Each further year adds one month of basic pay |
| Part years | Paid in proportion to the time worked | Six months into year seven counts as half a year at 30 days |
| Unpaid absence | Not counted as service | A month of unpaid leave pushes everything back a month |
| Ceiling | Total may not exceed two years' wage | Reached after roughly 25.5 years; later years add nothing |
A note on the day rate. The law does not spell out a daily-wage formula. It counts a month as 30 days (Article 67), and dividing the monthly basic wage by 30 is the standard practice this calculator follows. An employer using a different convention may arrive at a slightly different figure.
A worked example
An employee on a basic salary of AED 20,000 a month leaves after eight years. One day's wage is AED 20,000 ÷ 30 = AED 666.67.
Does resigning reduce it?
Not under the current law. The old Federal Law No. 8 of 1980 cut the gratuity of an employee on an unlimited contract who resigned early. The 2021 law requires fixed-term contracts and its Article 51 contains no reduction for resigning. One transitional exception remains: for service under an unlimited contract signed under the 1980 law, Article 68(3) lets the employer calculate the benefit under that contract's terms.
What can still reduce the cheque is a lawful deduction. The Executive Regulations limit these to a short list, including loans or overpayments, court-ordered debts and damage the employee caused. Payment is due within 14 days of the contract ending (Article 53).
03Basic salary
Why is my gratuity smaller than I expected?
Almost always because it is calculated on basic salary, and basic salary is often a minority of a UAE package.
Housing, transport, schooling and other allowances are excluded from the formula. Take the worked example above: if the AED 20,000 basic sits inside a AED 40,000 package, the AED 130,000 gratuity is worth 3.25 months of total pay after eight years, not the 6.5 months the basic-salary figure suggests. The optional package field in the calculator shows the same comparison for your own numbers.
The formula also uses your last basic wage. That rewards a late pay rise, because every earlier year is revalued at the new figure, and penalises a late step down for the same reason. It is the main reason two people with the same total earnings can leave with very different gratuities.
04Where you work
Does the same gratuity apply in DIFC, ADGM and free zones?
The formula above is the mainland rule. Two financial free zones, and UAE nationals, sit under different systems.
| Where you work | End-of-service system | Where to read more |
|---|---|---|
| Mainland private sector | Statutory gratuity under Federal Decree-Law No. 33 of 2021, or the alternative savings scheme if your employer has joined it | Lump sum or invest it? |
| DIFC | Monthly employer contributions to DIFC Employee Workplace Savings (DEWS) since February 2020, in place of a gratuity | DEWS explained |
| ADGM | ADGM's own Employment Regulations 2024: 21 and 30 days a year on a daily rate of basic ÷ 365, or a pension or savings scheme the employer offers in its place | Your employment contract and the ADGM Employment Regulations |
| UAE nationals | End-of-service benefit under the pensions law through GPSSA, not a gratuity | UAE state pension calculator |
Other free zones generally apply the federal labour law, but some publish their own employment rules. If your employer is licensed in a free zone, the contract will say which regime applies.
05What next?
What should you do with your gratuity?
The gratuity was designed as a severance payment, and for most expatriates it is the closest thing to a pension they have. At the ceiling it is worth two years' basic pay, set against a retirement that can run for twenty years or more.
Decide
Lump sum or invested scheme?
If your employer has joined the alternative savings scheme, the default option is capital-guaranteed. Here is what that costs over a long horizon.
Read the guide →Plan
Retirement without a pension
How expatriates in the UAE build the income a gratuity cannot provide on its own, and what portable means in practice.
Retirement planning guide →Build
A plan around it
See how Vault structures a financial plan around goals, cash flow and the lump sums that arrive along the way.
How Vault plans →For the bigger picture, One Day the Salary Stops converts a gratuity into the income it could replace and shows how early a target could arrive.
06FAQs
Gratuity questions people always ask.
How is gratuity calculated in the UAE?
For private-sector employees on the mainland, Article 51 of Federal Decree-Law No. 33 of 2021 sets the gratuity at 21 days of basic wage for each of the first five years of service and 30 days of basic wage for each year after that, based on the last basic wage you were paid. Fractions of a year count pro rata, days of unpaid absence do not count, and the total may not exceed two years' wage.
Do I get gratuity if I resign?
Yes, once you have completed at least one year of continuous service. Article 51 of the 2021 law contains no reduction for resigning, unlike the old 1980 law, so the formula is the same whoever ends a fixed-term contract. The one exception is transitional: for service under an old unlimited contract, Article 68(3) allows the employer to calculate the benefit under that contract. Lawful deductions, such as an outstanding loan from the employer, can also reduce the amount paid.
Is gratuity calculated on basic salary or total salary?
Basic salary only. Housing, transport, schooling and other allowances are excluded. In packages where basic pay is half of the total or less, the gratuity is correspondingly smaller than people expect, which is why the calculator above asks for your total package as an optional second figure.
What is the maximum gratuity in the UAE?
The total may not exceed two years' wage. Using the standard practice of dividing monthly basic by 30 for a day's wage, the formula reaches that ceiling after about 25.5 years of service. Beyond that point additional years add nothing, although a rising basic salary still raises the ceiling itself.
Do I get gratuity if I worked less than one year?
No. Article 51 makes the gratuity payable to an employee who has completed one year or more of continuous service. Below that threshold there is no statutory entitlement, though your contract or employer policy may be more generous.
When must my employer pay my gratuity?
The law requires the employer to settle the worker's dues, including the gratuity, within 14 days of the end of the employment relationship. If it is not paid, a complaint can be lodged with the Ministry of Human Resources and Emiratisation (MOHRE).
Does this calculator work for DIFC or ADGM employees?
Not for DIFC. Since February 2020 most DIFC employers pay monthly contributions into the DIFC Employee Workplace Savings (DEWS) plan instead of accruing a gratuity. ADGM's Employment Regulations 2024 use the same 21 and 30 days but on a daily rate of basic divided by 365, and allow employers to offer a pension or savings scheme instead. UAE nationals receive their end-of-service benefit through the GPSSA pension rather than a gratuity; see our state pension calculator.
Should I take my gratuity as cash or invest it?
Under the statutory system the gratuity arrives as one lump sum, and what you do with it is the decision that matters. If your employer has joined the alternative savings scheme set up by Cabinet Resolution No. 96 of 2023, you may instead be choosing how monthly contributions are invested. Our guide to taking the lump sum or investing it works through both cases.
Sources
- Federal Decree-Law No. 33 of 2021 on the Regulation of Labour Relations, Articles 51, 53, 67 and 68, consolidated text published by MOHRE. mohre.gov.ae
- UAE Government portal, "End of service benefits for employees in the private sector". u.ae
- Cabinet Resolution No. 1 of 2022 on the Implementation of Federal Decree-Law No. 33 of 2021, Articles 30 and 31 (part-time workers and permitted deductions).
- Cabinet Resolution No. 96 of 2023 on the Alternative End-of-Service Benefits Scheme; Ministry of Human Resources and Emiratisation, "Alternative end-of-service benefits system". mohre.gov.ae
- DIFC Employment Law No. 2 of 2019, Articles 65 and 66; DIFC, "Qualifying schemes". difc.com
- ADGM Employment Affairs Office, "Guidance: Employment Regulations 2024", February 2025.
Talk to Vault
Your gratuity is one number. Your retirement needs a plan.
A Vault advisor will look at what your end-of-service benefit is worth, what it needs to become, and how the rest of your savings get it there, in your own name and portable wherever you retire.