UAE Gratuity Calculator Online
Calculate Your UAE End of Service Gratuity
Accurate gratuity calculation based on UAE Labour Law (Federal Decree-Law No. 33 of 2021). Covers limited and unlimited contracts, resignation and termination scenarios.
Important Disclaimer
This calculator provides estimates for guidance purposes only. Actual gratuity amounts may vary based on your specific employment contract terms, company policies, unpaid leave deductions, or any amounts owed to the employer. Days of absence without pay are excluded from service calculations under UAE law. For any dispute or complex situation, consult a UAE-qualified HR professional or labour lawyer, or file a complaint with MoHRE at mohre.gov.ae.
If you are working in the UAE — whether as an employee planning your exit or an HR professional processing final settlements — knowing exactly how much gratuity you are entitled to is not just useful, it is your legal right. The UAE Gratuity Calculator by ExcelGuru gives you an instant, accurate answer based on the most current UAE Labour Law, completely free and with no sign-up required.
This calculator is based on Federal Decree-Law No. 33 of 2021, as amended by Federal Decree-Law No. 9 of 2024 (effective 31 August 2024) — the most current version of UAE Labour Law.
LATEST UPDATE: Federal Decree-Law No. 9 of 2024 — Effective 31 August 2024
Latest Changes to UAE Labour Law You Need to Know
UAE Labour Law has been significantly modernised over the past three years. Here is a summary of the key changes that directly affect gratuity calculations and end of service entitlements:
1. All unlimited contracts abolished (2022 onwards)
Under Federal Decree-Law No. 33 of 2021 (effective February 2022), unlimited or open-ended employment contracts were abolished. All employees in the UAE private sector must now be on fixed-term (limited) contracts with a maximum duration of three years, renewable by mutual agreement. This change eliminated the distinction between limited and unlimited contract gratuity rules for new contracts — though the old unlimited contract rules still apply to employees whose contracts were terminated before conversion.
2. Federal Decree-Law No. 20 of 2023 — Part-time and flexible workers
The 2023 amendment extended gratuity protections to part-time and flexible employees. Their gratuity is calculated proportionally: the actual hours worked per year divided by the hours in a full-time contract, multiplied by the standard gratuity entitlement. This means more workers than ever are entitled to end of service benefits.
3. Federal Decree-Law No. 9 of 2024 — Effective 31 August 2024
The most recent amendment introduced two significant changes. First, it extended the limitation period for filing a labour claim to two years from the date of employment termination (previously one year). Second, it strengthened the authority of the Ministry of Human Resources and Emiratisation (MoHRE), making MoHRE decisions legally enforceable as writs of execution — meaning employees can enforce gratuity claims without a lengthy court process.
4. Voluntary End of Service Savings Scheme
The UAE also introduced a voluntary alternative savings scheme approved by the Securities and Commodities Authority (SCA). Instead of the traditional end of service lump sum, participating employers make monthly contributions of 5.83% (for employees under 5 years) or 8.33% (for employees over 5 years) of basic salary into regulated investment funds. This scheme is optional and does not replace the statutory gratuity unless the employer specifically enrolls employees.
5. Gratuity must be paid within 14 days
Under the current law, employers are legally required to settle all end of service entitlements, including gratuity, within 14 days of the termination date. Failure to comply allows employees to file a complaint directly with MoHRE, which now has the authority to act as a writ of execution.
DIFC and ADGM free zone employees follow separate frameworks. Employers in DIFC must make monthly contributions (5.83% to 8.33% of basic salary) into a qualifying workplace savings plan rather than paying traditional gratuity.
How UAE Gratuity Is Calculated in 2025
The gratuity formula under UAE Labour Law is based on your last basic salary only — housing allowance, transport allowance, and any other benefits are excluded. The calculation is:
- Daily rate = Monthly basic salary divided by 30
- Years 1 to 5: 21 days of basic salary per year of service
- Year 6 onwards: 30 days of basic salary for each additional year
- Maximum cap: Total gratuity cannot exceed 2 years of basic salary
- Minimum service: At least 1 full year of continuous service required
For example, if your monthly basic salary is AED 10,000 and you have served 4 years:
- Daily rate = AED 10,000 / 30 = AED 333.33
- Gratuity = 4 years x 21 days x AED 333.33 = AED 28,000
Unlimited Contract Legacy Rules (Pre-2022 Conversions)
If your unlimited contract was terminated before it was converted to a limited contract, the older resignation reduction rules apply. Under the previous system, employees who resigned from an unlimited contract received reduced entitlement depending on years of service:
- 1 to 3 years of service: 1/3 of full gratuity entitlement
- 3 to 5 years of service: 2/3 of full gratuity entitlement
- 5 or more years of service: Full gratuity entitlement
For termination by the employer on an unlimited contract, full entitlement always applied regardless of years served. Our calculator handles both limited and legacy unlimited contract scenarios accurately.
How to Use the UAE Gratuity Calculator
- Enter your monthly basic salary in AED (do not include allowances)
- Select your employment start date and last working day
- Choose your contract type: Limited or Unlimited
- Select reason for leaving: Resignation or Termination
- Your gratuity amount appears instantly with a full breakdown
The calculator shows your daily rate, per-year band breakdown, any reduction applied for resignation, the 2-year cap if triggered, and your total gratuity payable — all in one screen.
Who Should Use This Calculator?
This tool is designed for employees in the UAE private sector who want to know their gratuity entitlement before leaving a job, HR professionals calculating final settlement amounts, finance managers forecasting end of service liabilities, and employers who want to ensure they are meeting their legal obligations under the current law.
Frequently Asked Questions
Is gratuity taxed in the UAE?
No. The UAE does not impose personal income tax, and gratuity payments are not subject to any tax deduction. You receive the full calculated amount.
What happens if my employer refuses to pay gratuity?
Under Federal Decree-Law No. 9 of 2024, MoHRE decisions are now legally enforceable writs of execution. You can file a complaint at mohre.gov.ae or through the MOHRE app. You have up to two years from your termination date to file a claim.
Does gratuity apply to free zone employees?
Employees in mainland UAE and most free zones are covered by Federal Decree-Law No. 33 of 2021. However, DIFC and ADGM free zones follow their own employment frameworks. Check with your free zone authority to confirm which rules apply to your contract.
Is the calculation the same for resignation and termination in 2025?
For all employees on limited (fixed-term) contracts under the current law, yes — gratuity is the same whether you resign or are terminated (excluding gross misconduct). The resignation reduction rules only apply to legacy unlimited contracts terminated before their conversion to limited contracts.