Dubai Retirement Gratuity Calculator
Calculate your end-of-service gratuity as per UAE Labor Law
Calculation Details
Gratuity = Basic Salary × 21/30 × Years of Service
Total Gratuity Payable
What is UAE Retirement Gratuity
Gratuity is a payment made to employees when they leave a job after completing a certain period of service. It is designed to reward long-term commitment. In the UAE, both private and public sector employees are entitled to gratuity based on their years of service and basic salary.
Who is Eligible
Employees who have completed at least one year of continuous service with their employer are eligible. The longer the service, the higher the gratuity amount. Employees who resign before completing one year are generally not entitled to gratuity unless stated otherwise in the contract.
How to Calculate Gratuity in Dubai
The calculation depends on the length of service and the last basic salary.
- For the first five years of service, gratuity is calculated as 21 days of basic salary for each year.
- For service beyond five years, it is 30 days of basic salary for each additional year.
- The total gratuity cannot exceed two years’ worth of salary.
Formula for UAE Gratuity
Legal Framework
The UAE Federal Law Number Eight of 1980 on the Regulation of Labor Relations governs gratuity. Article 132 specifies the calculation method and eligibility criteria. The law ensures transparency and fairness between employers and employees.
View the full PDF of the UAE Federal Law Number Eight of 1980.
FAQs
Can gratuity be more than two years’ salary?
No, the law limits gratuity to a maximum of two years’ worth of salary.
Is gratuity calculated on total salary or basic pay?
It is always calculated on basic pay only. Housing allowance, transport, or bonuses are not part of the gratuity base. Some companies may add extras voluntarily, but the law only requires basic pay.
Can an employer withhold gratuity in UAE?
An employer can only withhold gratuity if the employee is dismissed for gross misconduct as defined in the labor law. Otherwise, gratuity must be paid regardless of who ends the contract.
Can gratuity be transferred directly to bank account?
Yes, many employers transfer gratuity through the WPS system or directly to the employee’s UAE bank account. Payment in cash is less common but still allowed if agreed.