UAE Gratuity Calculator
✓ 2026 Labor Law Compliant
Exclude allowances. No minimum salary threshold.
How UAE Gratuity is Calculated After 5 Years
Reaching the five-year milestone at a company in the UAE significantly boosts your end-of-service (EOS) benefits. Under Federal Decree-Law No. 33 of 2021, the Ministry of Human Resources and Emiratisation (MOHRE) mandates a specific formula for long-term employees. While the first five years of service are calculated at 21 days of your basic salary for each year, any service beyond the five-year mark is calculated at 30 days of your basic salary per year.
It is essential to note that these calculations strictly use your latest basic salary, excluding any allowances such as housing, transportation, or bonuses. Furthermore, any unpaid leave taken during your tenure is subtracted from your total days of service.
The 30-Day Basic Salary Rule Explained
When computing your payout, the first step is determining your daily basic wage. This is done by dividing your monthly basic salary by 30. For example, if your basic salary is AED 15,000, your daily wage is AED 500.
For the first five years, you receive 21 days’ pay per year (500 × 21 × 5 = AED 52,500). If you worked for a total of seven years, the two additional years fall under the 30-day rule. You would receive 30 days’ pay for each of those two years (500 × 30 × 2 = AED 30,000). Your total gratuity would then be AED 82,500. The law stipulates a maximum cap on this payout: the total gratuity amount cannot exceed the equivalent of two years of your total salary.
Frequently Asked Questions
Does resignation affect my gratuity after 5 years?▼
Under the updated UAE Labour Law (effective Feb 2022), the type of contract (all are now limited) and the method of separation no longer cause deductions in your gratuity. Whether you resign or are terminated, as long as you have completed over a year of service (and aren’t dismissed for gross misconduct), you are entitled to your full calculation of 21 days for the first five years and 30 days for subsequent years.
Are unpaid leave days counted toward my 5 years?▼
No, days taken as unpaid leave are legally excluded from your total length of service when calculating end-of-service gratuity. The final calculation will deduct these days to determine your precise tenure.
Is there a maximum cap on the gratuity amount?▼
Yes. Regardless of how many years you have served beyond the five-year mark, the total end-of-service gratuity payout cannot exceed the equivalent of two years of your total gross salary.