UAE gratuity: the 21-day and 30-day rule, resignation and the cap
Short answer: UAE gratuity is 21 days of basic salary per year for the first five years and 30 days per year after that, capped at two years' wage. Since the 2022 labour law, resigning no longer reduces it.
The formula
Under Article 51 of Federal Decree-Law No. 33 of 2021, an expatriate employee with at least one year of continuous service gets:
- 21 days of basic salary for each of the first five years
- 30 days of basic salary for each year after the fifth
The daily rate is your last monthly basic salary ÷ 30, and part years are paid in proportion.
The jump after five years
Year six is where gratuity starts growing faster. With a basic of 10,000 AED and six years of service: 21 × 5 = 105 days, plus 30 × 1 = 30 days, for 135 days in total. At 333.33 AED a day that is 45,000 AED.
| Basic (AED) | Years | Days | Gratuity |
|---|---|---|---|
| 5,000 | 3 | 63 | 10,500 AED |
| 8,000 | 4 | 84 | 22,400 AED |
| 10,000 | 6 | 135 | 45,000 AED |
| 15,000 | 10 | 255 | 127,500 AED |
Resigning no longer reduces gratuity
Under the old law, employees who resigned from unlimited contracts got only a third or two thirds of their gratuity. The current law removed that reduction. After one year of service, resignation and termination are treated the same way.
The two-year cap
Total gratuity cannot exceed two years' wage. At the standard rates that limit is reached at roughly 25.5 years of service, so it only matters for very long careers. The calculator applies it automatically.
When it must be paid
Employers must settle your gratuity and other dues within 14 days of the end of employment.
Who these rules cover
These rules apply to private-sector employees on the UAE mainland. Employees in DIFC are covered by the DEWS savings plan instead, and ADGM and some government roles have their own rules. Employment ending during probation gives no gratuity, because one full year of service is required.