Gratuity Calculator UAE [Dubai, Abu Dhabi]

Welcome to gratuitycalculatoruae.com! Here you can easily calculate your gratuity for UAE by entering your basic salary and joining and Termination Date.

This Gratuity Calculator is useful to calculate gratuity of all employees working in any part of the United Arab Emirates.


The gratuity is paid at the time of resignation or termination or retirement or end of contract. The UAE gratuity calculation is a bit complicated, therefore I am here with a guide on how to calculate gratuity in UAE with help of the gratuity computation formula provided by the Labour Department.

What is Gratuity? Meaning and Importance

The gratuity is an end-of-service benefit given to the employee by the employer in United Arab Emirates. The gratuity is a lump sum amount paid by the employer to all eligible employees when they resign or get terminated or their contract period is over.

Gratuity Calculator UAE

As per UAE Labour Law Rules, every employer or company is required to pay gratuity to its employees/workers at the time of end-of-service. Both the permanent and contractual/temporary employees are entitled to receive gratuity from their employer if they meet the required eligibility criteria.

Who is Eligible to Get Gratuity in UAE?

Every employee, who has completed at least one year of service with the same employer, is eligible to get gratuity in UAE. The employer needs to calculate and pay gratuity to the eligible employee at the time of end of employment due to whatever reason.

To bring more clarity, here I provide types & categories of employees that are eligible for gratuity benefit in UAE.

  • Both the Emirati Citizens and Expat Employees
  • Both the Male Employees and Female Employees
  • Employees on Limited Contracts and Unlimited Contracts
  • Permanent Employees and Contractual Employees
  • Federal Government Employees
  • Private Sector Employees
  • Employees Who Resigned from the Job
  • Employees Who are Terminated by the Employer/Company
  • Employees Whose Contract Period is Over
  • Employees Who Took Retirement

In case an employee has worked for less than one year, s/he is NOT eligible to get gratuity and the employer is not liable to pay gratuity to such employees.

What is Gratuity Calculator UAE?

The Gratuity Calculator UAE is a special calculator designed for calculation of gratuity of the employee in United Arab Emirates.

The employees who are working in Dubai, Abu Dhabi, Sharjah, Ajman or any other Emirate, can use the UAE Gratuity Calculator to calculate gratuity amount that they are eligible to receive from the employer.

You can check the Live Gratuity Calculator UAE above. The UAE gratuity calculator is available for free for everyone who wants to calculate gratuity based on the basic salary and other factors.

The UAE gratuity calculator is applicable in entire country, so the employees of Dubai can use it as a gratuity calculator Dubai, while Abu Dhabi employees can use it as a gratuity calculator Abu Dhabi for quick calculation. If you work in Sharjah, you can consider the above calculator as the gratuity calculator Sharjah to calculate your gratuity benefit.

How to Use Gratuity Calculator UAE

To calculate gratuity without any confusion or manual formula, you must use the Gratuity Calculator UAE mentioned above. Kindly follow the step-by-step process given below.

  1. Enter Last Basic Salary (without any allowances or perks).
  2. Select Contract Type (Limited or Unlimited).
  3. Select Employment End Type (Termination/End of Contract or Resignation).
  4. Enter First Working Day as DD-MM-YYYY.
  5. Enter Last Working Day as DD-MM-YYYY.
  6. Click on Calculate/Go button to proceed.
  7. The calculator will show your total gratuity amount as well as year-wise gratuity benefit details on screen.

So, this is how you can use the UAE Gratuity Calculator to calculate gratuity of any employee/worker in Dubai, Abu Dhabi or other parts of UAE.

More About Gratuity:-

Factors to Consider for Gratuity Calculation in UAE

To learn how to calculate gratuity and the gratuity calculation formula, it is necessary to know about the factors to consider for calculating gratuity in UAE. As per the Labour Law Guidelines, the employer should consider following factors to calculate gratuity of his employee(s).

[I] Last Basic Salary:

The first and most important factor for calculation of gratuity in UAE is last basic salary of the employee. Kindly note that additional allowances for dearness, transport, children’s education, overtime and other perks/benefits are not included in basic salary.

So, the basic salary considered for gratuity calculation in UAE does not include any additional allowances.

  • If you are an employee, you should consider your basic pay salary for gratuity calculation.
  • If you are an employer/company, you should consider your employee’s basic salary.

[II] Contract Type:

You must know the contract type to calculate gratuity. The employers/companies in UAE hire employees on two types of contracts i.e. Limited Contract or Unlimited Contract.

  • A Limited Contract is linked with the concerned employee’s Residency Visa. So, the contract expires together with the visa of the employee if not renewed by both the employer & employee.
  • An Unlimited Contract is an open-ended contract that can be terminated either by the employer or the employee or by the Law if needed.

[III] Employment End Type:

The gratuity calculation formula is different for resigned employees and terminated employees. So, you need to select the employment end type option as Termination/End of Contract or Resignation as applicable in the gratuity calculator UAE.

[IV] Number of Service Years:

The last yet very important detail for calculating gratuity amount is the number of service years. You must know how many years you (the employee) has completed with the current employer/company in UAE. The entire working period, including service years and months, is considered to find the accurate gratuity amount at the end of the service.

So, these are the four most important factors that you must consider to calculate gratuity as per the formula given by UAE Labour Law.

Important Points about Gratuity in UAE

There are some important points about Gratuity in UAE, every employee and employer should know about these points.

  • The gratuity must be calculated on the last basic salary without any additional allowances and without cutting-down any expense from the basic salary.
  • If an employee has not completed one year of service at current employer, s/he is not eligible for gratuity.
  • If an employee has caused loss or damage to employer/company’s materials or assets/equipment, s/he is not eligible to get gratuity.
  • The employer can disqualify an employee from gratuity benefit if the employee is not able to do the basic work covered in his/her job profile.
  • If an employee has an amount to pay to the employer/company, the employer can adjust that amount with gratuity and pay the remaining amount to the employee.
  • The Total Gratuity Benefit Amount must Not exceed the employee’s 2 years salary amount.

Gratuity Calculation Formula for Limited Contract

The UAE Labour Law Department has given a specific formula for gratuity calculation of the employees working under a Limited Contract in UAE.

Service Years – 1 to 5 Years

  • Gratuity = (Last Basic Salary x 21 Days x Service Years)/30

Service Years: More than 5 Years

  • Gratuity = (Last Basic Salary x 30 Days x Service Years)/30

Gratuity Calculation Formula for Unlimited Contract

The employment under an Unlimited Contract does not have a time limit or validity. So, the UAE Labour Law Department recommends to calculate gratuity of employees working under an Unlimited Contract by their employment end type i.e. Resignation or Termination/End of Contract.

For Resignation:

If the employment ended by resignation of the employee, consider following rules for gratuity calculation for an unlimited contract.

Service PeriodGratuity Calculation Rules
If an Employee Resigns in Less than 1 YearNo Gratuity will be Paid.
If an Employee Resigns in 1-3 Years of Service1/3rd of 21 Days Basic Salary for Each Service Year will be Paid as Gratuity.
If an Employee Resigns in 3-5 Years of Service2/3rd of 21 Days Basic Salary for Each Service Year will be Paid as Gratuity.
If an Employee Resigns after 5 Years of ServiceFor First 5 Years – 21 Days Basic Salary for Each Service Year will be Paid as Gratuity.From 6th Year – 30 Days Basic Salary for Each Service Year will be Paid as Gratuity.

1 to 3 Years:

Gratuity = [Last Basic Salary x 21 Days x 1/3 x Completed Years of Service] ÷ 30

3 to 5 Years:

Gratuity = [Last Basic Salary x 21 Days x 2/3 x Completed Years of Service] ÷ 30

After 5 Years:

First 5 Years: Gratuity = [Last Basic Salary x 21 Days x Completed Years of Service] ÷ 30

After 5 Years: Gratuity = [Last Basic Salary x 30 Days x Completed Years of Service from 6th Year] ÷ 30

For Termination or End of Contract:

If the employment is ended by termination of the employee or end-of-contract, consider the following rules for gratuity calculation for an unlimited contract.

Service PeriodGratuity Calculation Rules
If an Employee is Terminated in Less than 1 YearNo Gratuity will be Paid.
If an Employee is Terminated in 1-5 Years of Service21 Days Basic Salary for Each Service Year will be Paid as Gratuity.
If an Employee is Terminated after 5 Years of ServiceFor First 5 Years – 21 Days Basic Salary for Each Service Year will be Paid as Gratuity.From 6th Year – 30 Days Basic Salary for Each Service Year will be Paid as Gratuity.

For First 5 Years:

Gratuity = [Last Basic Salary x 21 Days x Completed Years of Service] ÷ 30

After 5 Years:

Gratuity = [Last Basic Salary x 30 Days x Completed Years of Service from 6th Year] ÷ 30

In this way, all the employers or companies are required to pay gratuity to their employees when they retire or resign or get terminated or their contract period gets over.

The gratuity is payable only to the employees who have been working with the same company for one year or longer. The employers/companies must calculate gratuity as per the formula and calculation rules mentioned above.

Summary:

To make gratuity calculation easier, I have shared all necessary information about Gratuity Calculator UAE and its usage guide. You can use the calculator to find out any employee’s gratuity benefit amount in seconds.

Disclaimer:

The Gratuity Calculator UAE given above is made for calculating gratuity by an individual or company/organization. It is designed to calculate and show accurate gratuity amount but it does not claim any legality.

In case of any dispute in gratuity calculation, the concerned employer and employee(s) should contact UAE Labour Department, Ministry of Human Resources & Emiratisation (MOHRE).

FAQs about Gratuity Calculator UAE

Who can get gratuity benefit in UAE?

Any employee can get gratuity benefit in UAE if s/he has completed minimum one year of service at current/same employer.

What is the maximum gratuity limit?

When an employee can get gratuity?

How do I calculate my gratuity amount?

What is the other name of Gratuity Calculator Dubai?