UAE end-of-service gratuity calculator
Estimate an employee's end-of-service benefits (EOSB) in seconds using the UAE Labour Law formula. Then let FlexPayroll calculate it automatically for your entire team.
Gratuity Calculator
UAE end-of-service estimate
Basic salary only — housing, transport & other allowances are excluded.
Estimated gratuity
AED 19,600
Days accrued
74 days
Service
3.5 yrs
Illustrative estimate based on UAE Labour Law (21 days/yr for years 1–5, 30 days/yr after, capped at 2 years' wages). Not legal advice.
How UAE gratuity is calculated
End-of-service gratuity follows a clear formula under UAE Labour Law. Here's what determines the amount.
Years 1–5
21 days of basic salary for each full year of service.
Beyond 5 years
30 days of basic salary for each additional year.
Based on basic salary
Only the last basic salary counts — allowances are excluded.
Two-year cap
Total gratuity can never exceed two years' total wages.
Worked example: An employee with a basic salary of AED 8,000 who leaves after 6 years accrues 21 days × 5 years + 30 days × 1 year = 135 days. At a daily wage of AED 266.67, that's roughly AED 36,000 in gratuity — well within the two-year cap of AED 192,000.
Gratuity, automated and audit-ready
Manual gratuity calculations are error-prone and slow — and mistakes can lead to disputes or penalties. FlexPayroll maintains an accurate gratuity provision for every employee and produces a clear, defensible final settlement the moment someone leaves.
- Live gratuity provision tracked per employee
- Automatic 21/30-day formula with the two-year cap
- Leave encashment and final dues included
- Settlement ready inside the 14-day legal window
Final settlement preview
End-of-service questions, answered
Any employee who completes at least one year of continuous service is entitled to end-of-service gratuity (EOSB) when their employment ends — whether through resignation, termination, or end of contract. Gratuity is calculated on the last basic salary, excluding allowances.
For the first five years of service, gratuity accrues at 21 days of basic salary per year. Beyond five years, it accrues at 30 days per year. The daily wage is the basic monthly salary divided by 30, and total gratuity is capped at two years' total wages.
Gratuity is calculated on the last basic salary only. Housing, transport, utilities, and other allowances are excluded from the calculation.
Employers must settle the end-of-service gratuity and other final dues within 14 days of the end of employment. FlexPayroll prepares the full settlement so you can pay within this window.
This calculator and guide are for general information only and do not constitute legal advice. For complex cases, consult a qualified UAE labour-law professional.
Automate gratuity for your whole team
FlexPayroll keeps a live gratuity provision for every employee and produces compliant final settlements automatically. Book a free demo.
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