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Your end-of-service benefit on basic salary, with the 21-day and 30-day bands shown separately and the statutory cap applied.
Last reviewed: · General information, not legal advice
For mainland UAE private-sector employees, end-of-service gratuity under Article 51 of Federal Decree-Law No. 33 of 2021 is 21 days' basic wage for each of the first five years of service and 30 days' basic wage for each year after that, paid pro rata for part years. You need at least one year of continuous service, the total cannot exceed two years' wage, and it is the same whether you resign or are terminated. Example: AED 6,000 basic and 6 years 4 months of service gives about AED 29,000.
Gratuity is calculated on basic salary only — not gross. Check your contract for the basic figure.
Under Federal Decree-Law No. 33 of 2021, end-of-service gratuity is built from two bands, both paid on basic salary:
| Length of service | Entitlement per year |
|---|---|
| Less than 1 year | No gratuity |
| 1 to 5 years | 21 days of basic salary per year |
| Each year beyond 5 | 30 days of basic salary per year |
| Overall maximum | 2 years' wage (Article 51) |
The usual method, used here, takes the daily wage as monthly basic salary divided by 30 (the law counts a month as 30 days; it does not spell out a daily-wage formula for gratuity). So one year in the first band is basic ÷ 30 × 21, and one year in the second band is simply one month of basic pay.
Take a basic salary of AED 6,000 and 6 years 4 months of service:
The cap is two years' wages — here 2 × 12 × 6,000 = AED 144,000 — so it does not bite. Because the cap equals 720 days of basic pay (105 days for the first five years plus 30 days for each later year), it is only reached after about 25.5 years of continuous service, whatever the salary.
Once you pass one year of service, additional months are paid pro rata. There is no rounding up to the next whole year and no requirement to complete a further full year to be paid for the months you worked.
End-of-service gratuity is one component of your final settlement. The rest is calculated separately:
Divide your monthly basic salary by 30 to get a daily wage. Multiply that by 21 for each of your first five years, and by 30 for each year after five. Add the two together. Service under one year earns no gratuity, and the total is capped at two years' wages.
Basic salary only. Housing, transport, phone and all other allowances are excluded, which is why the gratuity figure is usually much smaller than employees expect from a gross salary.
No. Federal Decree-Law 33/2021, in force since February 2022, removed the old reductions for resignation. Anyone with more than one year of continuous service receives the full calculation whether they resign or are terminated.
Yes. Periods of unpaid leave do not count as service, so they are deducted from the total length of service used in the calculation. Paid annual leave counts normally.
Within 14 days of the contract end date. If your employer misses that deadline you can file a complaint with MOHRE.
Yes, total gratuity cannot exceed two years' wage (Article 51 of Federal Decree-Law 33/2021). Measured in basic pay, that ceiling is only reached after about 25.5 years of continuous service, whatever the salary.
Source: Federal Decree-Law No. 33 of 2021 and its amendments (official MOHRE English translation, PDF). The Arabic text prevails.