Gratuity/EOSB is a statutory payment made by an employer to an employee at the end of their service period in the UAE. It's mandated by the UAE Labour Law as a form of recognition for the employee's service, provided they have completed at least one continuous year with the company.
UAE Gratuity Calculator
Estimate your End-of-Service Benefits (EOSB) in the UAE
Understanding Gratuity (End-of-Service Benefits) in the UAE
Gratuity, also known as End-of-Service Benefit (EOSB), is a mandatory payment employers in the UAE owe to their employees upon the end of their service period, provided they meet certain criteria (like completing at least one year of continuous service). It serves as a token of appreciation for the employee's contribution and loyalty. This calculator helps estimate this amount based on the UAE Labour Law (Federal Decree-Law No. 33 of 2021 and related current guidance.
How Gratuity Is Calculated in the UAE
For employees under Limited (Fixed-Term) Contracts, the calculation is based on the last drawn basic salary:
- 1 to 5 years of service: Gratuity = (Basic Salary / 30) * 21 * Number of Years Served. You receive 21 days' basic salary for each year of the first five years.
- More than 5 years of service: Gratuity = [(Basic Salary / 30) * 21 * 5] + [(Basic Salary / 30) * 30 * (Total Years Served - 5)]. You receive 21 days' basic salary for each of the first five years, and 30 days' basic salary for each subsequent year.
Note: This estimate uses the standard calculation for covered full-time foreign workers and does not determine special or historical contract cases.
Employment Contracts and Gratuity
Under the current UAE private-sector labour framework, employment contracts are for a defined term. For covered full-time foreign workers, gratuity is generally calculated from the last basic wage after at least one year of continuous service:
- First five years: 21 days of basic wage for each year of service.
- After five years: 30 days of basic wage for each additional year.
This calculator provides an estimate and does not resolve historical-contract, free-zone, part-time, or other special-case rules.
Key Eligibility Points for UAE Gratuity
- Applies mainly to expatriate employees in the private sector.
- Minimum of one year of continuous service is required.
- Calculation is based on the last drawn basic salary (excluding allowances).
- Total gratuity cannot exceed the equivalent of two years' wage; the calculation uses the last basic wage for covered full-time foreign workers.
- Payment is due within 14 days of the employment end date.
Disclaimer
This calculator provides an estimate based on standard interpretations of standard UAE Labour Law provisions. It does account for specific contract clauses, unpaid leave deductions, free zone variations (e.g., DIFC's DEWS scheme), or potential legal changes. Always verify with your HR department or seek legal advice for official calculations.
Frequently Asked Questions (FAQ)
Primarily, expatriate employees working in the UAE's private sector who complete at least one year of continuous service are eligible. UAE nationals traditionally had pension schemes, but recent voluntary schemes allow them to opt into end-of-service benefits too.
Gratuity is calculated based only on the employee's last drawn basic salary. Allowances such as housing, transport, or other benefits are not included in the gratuity calculation.
An employee must complete a minimum of one full year of continuous service with the employer to be eligible for any gratuity payment.
For UAE private-sector full-time foreign workers, gratuity is generally calculated from the last basic wage after at least one year of continuous service. The current labour framework uses fixed-term contracts; gratuity is not reduced under the former limited-versus-unlimited resignation schedule described by older guidance.
Yes. For covered full-time foreign workers, end-of-service benefits cannot exceed two years' wage. The calculation is based on the employee's last basic wage, not total salary including allowances.
The employer must pay the gratuity along with all other final settlement dues within 14 days from the employee's last working day (end date of the employment contract).
Yes, some free zones have different regulations. For example, the Dubai International Financial Centre (DIFC) uses the 'DIFC Employee Workplace Savings' (DEWS) plan, where employers make monthly contributions to a savings plan instead of a lump-sum gratuity payment at the end of service.
