UAE Gratuity payment eligibility
The gratuity payment eligibility criteria in the UAE is a complex process to understand. To make things simpler, we have sorted the most useful details and avoided all useless stuff.
Eligibility criteria for gratuity payment in the UAE
Under Federal Decree-Law No. 33 of 2021 (UAE Labour Law), which has applied since February 2022 and remains in force in 2026, end-of-service gratuity eligibility depends on your basic salary and total years of service:
| Period served | Eligible gratuity |
|---|---|
| Less than 1 year | No gratuity |
| 1 to 5 years | 21 days' basic salary for each year |
| More than 5 years | 21 days' basic salary per year for the first 5 years and 30 days' basic salary per year thereafter |
| Any period | Maximum gratuity capped at 2 years' basic salary |
Resignation and Termination
Under the current law, resignation and termination receive the same gratuity entitlement. The old rules that reduced gratuity for resigning employees on unlimited contracts (one-third or two-thirds of entitlement) no longer apply. You only need to have completed at least one year of continuous service.
What counts toward gratuity
- Gratuity is calculated on basic salary only - housing, transport and other allowances are excluded
- Daily wage is your monthly basic salary ÷ 30
- The same formula applies to limited and unlimited contracts
- All new contracts issued after February 2022 are fixed-term (limited)
When must gratuity be paid?
Your employer must pay all end-of-service entitlements, including gratuity, within 14 days of your last working day. If payment is delayed, you can file a complaint through the MOHRE app or call 600 590 000.
Hope you now understand the eligibility for gratuity payment and the calculation process involved in gratuity payment.
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