What You’ll Learn

In this episode, we explain what gratuity means in the UAE and how to calculate it easily. Gratuity is the end-of-service payment employees receive when leaving a job, as a reward for their service. We’ll guide you through the rules, formulas, and real examples so you can calculate your own amount confidently.

According to the UAE Labour Law (Federal Decree-Law No. 33 of 2021):

• Employees who have worked at least one year are entitled to gratuity.

• For the first five years, gratuity is based on 21 days of basic pay per year.

• After five years, it increases to 30 days of basic pay per year.

• The total gratuity cannot exceed two years’ wages.

Let’s say you worked 6 years in the same company with a basic monthly salary of AED 5,000.

• For the first 5 years: 5 × 21 days = 105 days of salary.

• For the 6th year: 1 × 30 days = 30 days of salary.

• Total = 135 days of pay = AED 22,500 (approx.).

You can use the UAE Gratuity Calculator online to check your exact amount instantly.

Whether you’re an employee, HR professional, or business owner, this episode helps you understand:

• How gratuity works under UAE law

• How to use the calculator correctly

• What mistakes to avoid when resigning or ending a contract

Stay informed, know your rights, and make smart financial decisions with Money Matters UAE: The Gratuity Guide.