Gratuity Calculator UAE 2026 | Free MOHRE Updated Tool

Does It Matter If You Resigned or Were Terminated?

No. Under current law, resigning or being terminated results in the same gratuity calculation, once you have completed one year of service.

This surprises a lot of people, because it used to work differently. Older UAE labour law reduced gratuity for employees who resigned, sometimes cutting it by a third or more depending on years worked. That rule no longer exists. If you see it mentioned anywhere today, including on well known news sites, it is describing a law that has already been repealed.

Article 44 sets out the specific situations where an employer can dismiss you without paying gratuity. These are narrow and involve serious misconduct, such as fraud, deliberate damage to the employer’s property, or working for a competitor without permission while employed. Being dismissed for ordinary performance issues, disagreements with management, or cost cutting does not fall under Article 44 and does not remove your gratuity.

If your employer ends your contract without cause, you still receive full gratuity. If a labour court later finds the termination was arbitrary, Article 47 allows for compensation on top of gratuity, not instead of it. A contract simply reaching its end date and not being renewed pays out the same way.

None of these situations change your gratuity, once you have one year of service:

• Resigning voluntarily
• Being terminated without cause
• Your fixed term contract ending naturally
• Redundancy or company restructuring

HR Is Asking Me to Resign Instead of Terminating Me. Should I?

For your gratuity specifically, it makes no difference. You will receive the same amount either way, once you have completed a year of service.

Where it can matter is elsewhere. Resigning may affect notice pay, how the termination is recorded with MOHRE, and in some cases eligibility for unemployment insurance payouts, which do look at the reason for leaving.

Get the actual reason for your departure confirmed in writing, whatever you decide. If there is ever a dispute later, that written record protects you more than which word appears on the paperwork.

This distinction used to matter for another reason too, tied to the type of contract someone held.

Limited and Unlimited Contracts: What Actually Changed in 2022

Unlimited contracts no longer exist in the UAE. Since February 2022, every mainland employment contract is a limited, fixed term contract, usually running one to three years and renewable.

Before that change, resigning from an unlimited contract before certain milestones reduced your gratuity, down to as little as a third of the normal amount in the early years of service. That reduction is gone. It does not apply to anyone leaving their job today, regardless of contract type or years worked.

This is where a lot of confusion still comes from. Plenty of pages online, including some run by established news outlets, still describe that old reduction as if it is current. It is not. You may also see references to Article 120 as the provision covering gratuity denial. Article 120 belonged to the repealed 1980 law. Article 44, covered above, is what applies today.

If a calculator or article still asks you to choose between limited and unlimited contract type and gives different results based on that choice, it is working from outdated law. For a fuller breakdown of how the two contract types used to differ, see our Limited vs Unlimited Contract Guide.

Contract type sorted out, the actual formula behind your number is what matters most from here.

How Gratuity Is Calculated in the UAE

Article 51 sets out the formula, built from two numbers: your basic salary and your years of service. The gratuity calculator UAE above runs this same formula automatically, but it helps to know what it is doing with your numbers. 

First Five Years: 21 Days per Year

For each of your first five years, you earn 21 days of basic pay: daily wage multiplied by 21, multiplied by years of service.

Take someone earning AED 6,000 basic salary, with 3 years of service.

Daily wage: 6,000 ÷ 30 = AED 200

Gratuity: 200 × 21 × 3 = AED 12,600

After Five Years: 30 Days per Year

Past five years of service, every additional year earns 30 days of basic pay instead of 21. The first five years still count at the 21 day rate.

Take someone earning AED 8,000 basic salary, with 7 years of service.

First 5 years: 8,000 ÷ 30 = AED 266.67 daily wage. 266.67 × 21 × 5 = AED 28,000

Remaining 2 years: 266.67 × 30 × 2 = AED 16,000

Total gratuity: AED 44,000

Gratuity by Years of Service

Years of Service	Basic Salary AED 5,000	Basic Salary AED 10,000	Basic Salary AED 15,000
1 year	3,500	7,000	10,500
2 years	7,000	14,000	21,000
3 years	10,500	21,000	31,500
5 years	17,500	35,000	52,500
7 years	27,500	55,000	82,500
10 years	42,500	85,000	127,500
15 years	67,500	135,000	202,500

These figures assume unbroken service with no unpaid leave. For your own exact amount, including partial years, enter your real dates into the calculator at the top of this page. 

Is Gratuity Calculated on Basic Salary or Full Salary?

Basic salary only. This is the single most common reason someone’s own calculation comes out higher than what their employer actually owes.

Your full salary package usually includes allowances on top of basic pay, housing, transport, utilities, commission or bonus payments. None of these count, no matter how large or consistent they are.

Take someone with a total monthly package of AED 10,000, made up of AED 6,000 basic salary, AED 3,000 housing allowance, and AED 1,000 transport allowance. After 4 years of service, using the full AED 10,000 gives a gratuity of AED 28,000. Using the correct basic salary of AED 6,000 gives AED 16,800. That gap comes entirely from allowances that were never part of the calculation.

This is also why two gratuity calculators can give different answers for the same person. If one asks for total salary and the other asks specifically for basic salary, they are not measuring the same thing. The calculator on this page asks for basic salary only, which is what Article 51 requires. 

Check your basic salary before you calculate anything. Your employment contract lists it as a separate line item alongside your other allowances. If you are unsure which figure is which, you can check your salary breakdown through the MOHRE app or verify your labour contract using UAE Pass.

My Contract Shows an Old Salary. Which One Counts?

Your gratuity is based on the last basic salary you were legally entitled to, not necessarily the number sitting in an outdated contract. If your basic salary increased over time but your employer never updated your official contract, you are still owed gratuity based on what you were actually paid.

Keep your payslips. If your employer ever disputes your basic salary figure, your payslip history is what shows what you actually earned each month.

Basic salary is one number in the formula. The other, the cap on how much gratuity can add up to, matters just as much for anyone with several years of service.

What Is the Maximum Gratuity You Can Receive?

Your total gratuity cannot exceed two years of basic salary, no matter how many years you have worked.

This cap is a hard ceiling on the payout, separate from the 21 and 30 day formula itself. You can work well past the point where the formula alone would produce a larger number, and the payment still stops at two years of basic pay.

Long service does not exempt you from this limit. An Abu Dhabi labour court case involved an employee with 31 years of service, and the ruling still applied the two year cap to the final payout rather than paying a full 31 years at the 30 day rate.

Take someone with a basic salary of AED 10,000. Two years of basic salary works out to AED 240,000. Under the standard formula, this cap starts to matter once someone has worked around 9 to 10 years, depending on exact salary, since that is roughly where the calculation begins producing totals that would otherwise pass AED 240,000.

Most people never reach this cap. It mainly affects long serving employees on higher basic salaries, where decades of service would otherwise add up to more than two years of pay.

A number that comes in lower than the cap can still come in lower than expected, and unpaid leave is usually why.

Does Unpaid Leave Reduce Your Gratuity?

Yes. Any days taken as unpaid leave are excluded from your service period when your gratuity is calculated.

Gratuity is based on continuous, paid service. Unpaid leave breaks that continuity for the days involved, so those days do not count toward your total years, even though you remained employed throughout. Paid annual leave and paid sick leave are different, both count as normal working time.

Say someone has worked exactly 5 years but took 2 months of unpaid leave at some point. Their service period for gratuity purposes comes out to roughly 4 years and 10 months, not a full 5, because those unpaid months are set aside before the calculation runs.

This catches people out when they count years of service from their join date without accounting for unpaid breaks along the way. Two employees who started the same day can end up with different gratuity totals if only one of them took unpaid leave.

If you have taken unpaid leave at any point, subtract that time from your total service before working out which year rate applies to you.

Getting the right number is one concern. Actually receiving it on time is another, and the law is specific about how long your employer can take.

If your case involves misconduct, an early resignation, or unpaid leave that shifted your service years, one of these articles is almost always the reason your number looks different from a standard gratuity calculation. When in doubt, cross-check the specific article against your situation rather than relying on the general formula alone.

When Should Your Employer Pay Your Gratuity?

Your employer has 14 days from your last working day to pay your gratuity in full, under Article 53.

That 14 day window starts from your contract end date, not from whenever visa cancellation happens to get processed. Employers sometimes point to visa formalities as a reason for delay, but the law does not tie the payment deadline to that process.

Gratuity is not paid on its own. Your end of service benefits come as part of your full and final settlement, alongside any unpaid wages, notice pay if applicable, and payment for accrued but unused annual leave, all settled together within the same 14 days. 

Your full and final settlement should include:

• Your outstanding gratuity
• Any unpaid salary up to your last working day
• Payment for unused annual leave
• Notice period pay, where applicable

Past that 14 day mark with no payment, you already have grounds to act, and knowing where to take that is worth having ready before you need it.

Can Your Employer Refuse to Pay or Make Deductions?

Your employer can only deduct specific, provable amounts from your gratuity. They cannot refuse to pay it outright, and they cannot use it to settle unrelated arguments.

Lawful deductions are limited to things like outstanding loans from your employer, salary advances already received, or other amounts you genuinely owe. These need to be documented, not just claimed.

An unrelated dispute is not a valid reason to withhold your gratuity. Disagreeing over a bonus or commission payment does not give your employer the right to hold back money you are legally owed for your service.

Training cost clawbacks work the same way. A written, signed clause agreeing to specific deductions under specific conditions can be enforced. Without that agreement in place before the training happened, an employer cannot invent a deduction after the fact.

None of these are lawful reasons to withhold your gratuity:

• You resigned instead of being terminated
• Your employer is unhappy with your performance
• There is an ongoing disagreement over something unrelated, like a bonus
• Your employer simply has not gotten around to processing it

Can a False Absconding Report Take Away Your Gratuity?

An employer filing a false absconding report against you is a serious step, and one that carries real penalties for them if it is proven false.

Check your status through the MOHRE app or GDRFA system to confirm whether a report has actually been filed. From there, file a complaint directly with MOHRE disputing it, backed by any evidence you were not absconding, such as your resignation letter, correspondence with your employer, or your last known attendance.

There is a real difference between what your employer is legally allowed to do, and what they might try anyway. If they do, here is exactly where that complaint goes.

What to Do If Your Employer Will Not Pay

Start with MOHRE. File a complaint through the MOHRE app, the MOHRE website, or by calling their hotline at 600 590 000. MOHRE gratuity complaints are handled directly by the ministry, and filing one costs you nothing. 

Taw-jeeh service centres can help you put the complaint together in person, useful if you would rather not file it alone. Once filed, MOHRE typically attempts to resolve the matter directly with your employer first. If that does not lead to payment, the case gets referred to the Labour Court as a formal legal claim.

Do not wait too long to act. Article 54 gives you two years from your last working day to bring a gratuity claim. Past that window, the claim can be time barred regardless of how clear cut it is.

If you work for a company registered under DDA or TECOM, your process is different. These free zones handle labour disputes through their own free zone authority rather than MOHRE, so check with your specific free zone’s employment office first.

Your options if payment does not arrive:

• File a complaint with MOHRE, by app, website, or hotline
• Visit a Taw-jeeh centre for help submitting your case
• Wait for MOHRE’s attempt to resolve it directly with your employer
• Take the case to Labour Court if it remains unresolved
• File within two years of your last working day, under Article 54
• Use your specific free zone authority instead, if you fall under DDA or TECOM

Everything so far covers mainland employment mostly. Free zones bring genuine variations of their own.

Gratuity Rules in UAE Free Zones

Working in a free zone does not automatically change your gratuity. Most free zones, including JAFZA, DAFZA, DMCC, Dubai South, SAIF Zone, and RAKEZ, follow the same federal labour law as the mainland.

If your employer is registered in one of these zones, the same 21 and 30 day formula applies, using the same basic salary rules covered earlier. A small number of free zones run their own separate systems, and these are the genuine exceptions worth knowing.

DIFC and the DEWS Scheme

DIFC does not use the standard lump sum model. Employers instead make monthly contributions into DEWS, the DIFC Employee Workplace Savings plan. Rather than accumulating an entitlement calculated at the end of employment, your employer pays into this fund throughout your service, and the balance is yours when you leave.

ADGM

ADGM operates under its own employment regulations, separate from both the mainland system and DIFC’s DEWS model, with its own end of service framework. If your employer is based in ADGM, check your contract and ADGM’s regulations directly, since the calculation approach differs from the standard formula used elsewhere.

Standard employment and free zones cover most people. Part time and temporary work changes the calculation in its own particular way.

Gratuity for Part Time and Temporary Workers

Part time and temporary employees are entitled to gratuity too, calculated on a pro rata basis under Cabinet Resolution No. 1 of 2022.

Instead of a full time basic salary, your gratuity uses the ratio between your contracted hours and a standard full time schedule. Fewer hours than full time means a smaller proportion of the standard formula applies to you.

Say a full time employee in a similar role would have a basic salary of AED 6,000, but you work half those hours under a part time contract. Your gratuity uses the same 21 and 30 day formula, scaled down to reflect working half the hours of a full time position.

The one year minimum service requirement still applies exactly as it does for full time employees. Part time work does not change how long you need to stay before gratuity kicks in, only how the final amount is scaled once you qualify.

Domestic work follows its own rules entirely, separate from this pro rata system.

Gratuity for Domestic Workers

Domestic workers are covered by a separate law entirely. Federal Decree-Law No. 9 of 2022 sets out their employment rules, not the main labour law that applies to standard private sector jobs.

This covers maids, drivers, nannies, cooks, gardeners, and other household staff. If this describes your role, the 21 and 30 day formula covered earlier does not apply to you.

Instead, domestic workers earn 14 days of pay for every year of service, at a flat rate with no tier system. Someone with 2 years of service and someone with 8 years both earn the same 14 days per year. The one year minimum service requirement still applies here too.

Take someone earning AED 1,500 a month, with 3 years of service.

Daily wage: 1,500 ÷ 30 = AED 50

Gratuity: 50 × 14 × 3 = AED 2,100

For a calculation built specifically around this 14 day formula, our Domestic Worker Gratuity Calculator is set up for exactly that.

Every category covered so far uses a lump sum, paid once employment ends. A newer alternative changes that entirely.

The New End of Service Savings Scheme

Some employers now pay into a savings scheme instead of the traditional lump sum, introduced under Cabinet Resolution No. 96 of 2023.

This is your employer’s choice, not yours. If they opt in, your gratuity works through this system automatically instead of the standard end of service payout. Your employer contributes a percentage of your basic salary into an investment fund every month: 5.83% for your first five years of service, rising to 8.33% after that. You can also add up to an extra 25% of your own wage voluntarily.

When you leave your job, the money in the fund is yours, either withdrawn or, depending on the fund, left invested to keep growing.

Because your gratuity has already been paid into the fund throughout your employment rather than owed as one amount at the end, you are not left exposed if your employer runs into financial trouble later, unlike the standard lump sum system. What that exposure actually looks like is worth knowing either way.

What Happens to Gratuity If an Employee Dies?

Gratuity is still payable if an employee dies during their employment. Article 51 treats death the same as termination, so the full entitlement is calculated exactly as if the employee had left the job themselves.

The amount is not lost. It passes to the legal heirs, following the same rules that apply to the rest of the person’s estate. The same 14 day payment window applies once the necessary documents, a death certificate and proof of legal heirship, are submitted.

If the death was work related, this payment is separate from any additional compensation owed under UAE labour law for a workplace death. Gratuity is paid based on service and salary regardless of cause of death, while work related compensation is a separate entitlement tied specifically to the job connection.

Death is one unexpected way employment can end. A company closing down entirely is another, and it raises a different question about whether gratuity still gets paid at all.

What Happens If the Company Shuts Down or Goes Bankrupt?

Your gratuity does not disappear if your employer goes bankrupt, but getting paid becomes a different process than a normal settlement.

Under the 2023 Bankruptcy Law, employees are treated as preferred creditors. Unpaid wages and gratuity are placed ahead of ordinary unsecured creditors, such as banks and suppliers, when the company’s remaining assets are distributed.

Preferred creditor status improves your position, but does not guarantee full payment. There is no government fund that covers your gratuity if the company has no money left once all claims are considered. It determines the order you get paid in, not whether the funds exist.

This is one reason the savings scheme covered earlier carries less risk. Contributions sit in your own fund throughout your employment rather than being owed as one amount at the end, so your money is not tied up in the company’s finances if it runs into trouble.

Most gratuity payments never involve any of this. Where things usually go wrong is smaller and far more avoidable.

Mistakes That Cost UAE Employees Money

Most gratuity disputes do not come from unclear law. They come from simple errors in the calculation, and most are avoidable once you know what to check.

Using full salary instead of basic salary, covered earlier on this page, remains the single biggest reason people expect more than they are actually owed.

Timing catches people out almost as often. Resigning a few weeks before your one year mark means walking away with nothing, when waiting those extra weeks secures the full entitlement. If you are close to that anniversary, check the exact date before handing in your notice.

Accepting a salary reduction shortly before leaving lowers your final gratuity, since the calculation uses your most recent basic salary. If your employer proposes a pay cut close to when you plan to leave, understand what that does to the number your gratuity is based on.

Signing your final settlement before checking the figures against your own calculation makes it much harder to dispute afterward. Check the breakdown against the formula on this page before agreeing to anything.

Common calculation errors to check for before you sign anything:

• Using total salary instead of basic salary
• Forgetting to exclude allowances like housing and transport
• Assuming a partial final year does not count, when it should be paid pro rata
• Relying on an outdated basic salary figure from an old contract
• Not accounting for unpaid leave taken during your service

Why Do Different Gratuity Calculators Give Different Answers?

Usually one of two reasons. Some calculators still use the old, repealed resignation formula covered earlier. Others divide salary by 31 days instead of the correct 30, which throws off the daily wage and the entire result.

If a calculator asks you to select limited or unlimited contract type, or divides by 31, it is working from an outdated formula. The gratuity calculator UAE on this page uses the 30 day divisor and applies no resignation reduction, matching Article 51 as it stands today.

How UAE Gratuity Compares to Saudi Arabia, Qatar, Kuwait, Oman and Bahrain

Saudi Arabia, Qatar, Kuwait, Oman, and Bahrain all require an end of service payment too, though the details vary by country.

Country	Accrual Rate	Minimum Service	Resignation Treatment
UAE	21 days per year (first 5 years), 30 days per year after	1 year	Full entitlement, no reduction
Saudi Arabia	Half a month’s salary per year (first 5 years), 1 month per year after	2 years	Reduced entitlement below 5 years of service
Qatar	3 weeks of basic salary per year	1 year	Reduced entitlement in some resignation cases
Kuwait	15 days per year (first 5 years), 1 month per year after	3 years	Reduced entitlement below 5 years of service
Oman	15 days per year (first 3 years), 1 month per year after	1 year	Full entitlement in most cases
Bahrain	Half a month per year (first 3 years), 1 month per year after	3 months	Varies, some resignation reductions still apply

The UAE removed its resignation penalty entirely in 2022, while Saudi Arabia and Kuwait still reduce payouts for employees who resign before reaching a set number of years. Its one year minimum service requirement is also shorter than most of its neighbours. Figures depend on your specific contract and sector, so confirm current details with that country’s labour ministry if you are comparing an actual offer.

Most people came to this page with a much more specific question in mind, and that is exactly what the section below is built to answer quickly.

How to Use the Gratuity Calculator on This Page

The calculator at the top of this page needs four things from you: your basic salary, your service start date, your last working day, and any unpaid leave days you took.

Enter your basic salary only, not your total package. Your service dates should reflect your actual first and last working days, not your visa dates. If you took unpaid leave at any point, add those days so they can be excluded from your service period.

The calculator then applies the 21 and 30 day rates from Article 51, checks your total against the two year cap, and gives you a year by year breakdown you can download as a PDF. That breakdown is useful if you need to compare against what your employer has offered you.