UAE End-of-Service Gratuity: How It Works

Updated 17 August 2026

The end-of-service gratuity is a lump sum paid to eligible private-sector employees when their employment ends. Understanding the basics helps you check that your final settlement is calculated correctly.

Who qualifies

Employees who complete a qualifying period of continuous service are generally entitled to a gratuity when they leave. Very short service or dismissal for certain serious reasons can affect eligibility.

How it is calculated

The gratuity is based on your basic salary (not total salary with allowances) and your length of service, with the daily rate applied to a set number of days per year of service. Longer service usually earns a higher rate per year.

Checking your settlement

When you leave, confirm which salary figure is being used and how many years of service are counted. If you are unsure, compare against the current formula or seek guidance before signing off on the final settlement.

Frequently asked questions

Is the gratuity based on total or basic salary?

It is based on basic salary, so allowances are usually excluded. Check your contract for how basic pay is defined.

This guide is general information, not legal or financial advice. Rules, fees and eligibility change — always confirm the current details with official UAE government sources before acting.