UAE Gratuity Calculation Method and Formula

Expatriates in UAE after completing or leaving their company must be given with End of Service Benefits also called Gratuity according to UAE Labour laws but the calculation is also in compliance with guidelines of labour laws, every retiring employee try to understand the calculation formulas so that he/she can identify any error on final gratuity pay.

Gratuity depends upon contract Fixed term or limited and undefined or Unlimited.

Also if employer break contract and terminate employee with any reason employee still get End of service but if it is due to any discipline or violation stated in article 139 than no gratuity is given.

End of service Gratuity based upon last salary paid into employee account.

Gratuity Calculation for Limited Contract:

Read More: What is Limited Contract in Labour Laws

Less than 1 year of service

1.No Gratuity is given if employee leaves before completing 1 years of his job.

2. Those who leaves between 1st and 5th years of service will entitled for full gratuity award based on 21 days of salary for each year of work.

3. Full Gratuity entitlement is given to those who leave the job after 5 years of service based on 30 days salary for each year of work.

Limited Contract Gratuity Pay Example:

Calculations for Unlimited Contract gratuity pay

1. leaving form job Less than 1 year of service means no Gratuity.
2. Leaving Between 1 year and 3 years of service employee is entitled for One Third of 21 days gratuity for each years of service.
3. Leaving Between 3 years and 5 years of service means employee is given with Two Third of gratuity pay based on 21 days salary for each years of job.
4. Leaving after 5 or more years of service than Employee is entitled to full 21-days gratuity.

More Calculation of Gratuity on Unlimited Contract

Unlimited Contract Gratuity Pay Example:

See the Basic UAE Gratuity Calculation Formula

These Calculations are just for reference and guidance for proper knowledge and solving disputes contact Ministry of Labor United Arab Emirates.


  1. How if a person is working in the house,but for more than 2 yrs.
    They can also avail the GRATUITY.
    Thanks..God bless…(Allah)

  2. Hi about it in title of this gratuity?& if the monthly salary is 3,000 how much will be the gratuity?thank you….

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