Discover Gratuity Calculator in the UAE: All You Need to Know

The gratuity calculator is merely for illustrative reasons and has no legal standing. The findings of the gratuity calculator are based on the most prevalent job situations under UAE labor laws. Employees working in the UAE are entitled to employer gratuity pay at the conclusion of their job if they complete one year of service, according to the UAE Labour Law. If an employee resigns or is terminated before one year of work, no gratuity will be provided.

In this article, we will be talking about the gratuity calculator. Please keep in mind that the calculator only considers the gratuity portion of final settlements; other factors like unused leave income, notice compensation, flying ticket, and so on are not included.

1. Learn the important contract factors for calculating gratuity in UAE
2. Discover how does the gratuity calculator in Dubai work

1. Learn the important contract factors for calculating gratuity in UAE

There are two types of work contracts in the UAE: limited and limitless. The rules for computing UAE gratuity calculator under both types of contracts differ and are detailed in full below.

1.1 The most recent basic wage

The final basic wage is used to calculate gratuity with the gratuity calculator in Abu Dhabi, but any additional bonuses and perks such as housing, transportation, overtime, children’s education, and so on are not to be included in the gratuity calculator in Dubai.

1.2 Term of employment

To be eligible for a gratuity with the Mohre gratuity calculator, you must have worked for at least one year.

Please keep in mind that gratuity with the gratuity calculator UAE 2021 should be with a base on continuous work. In other words, if an employee has been away from work without compensation during his or her service tenure, that time should not be used for computing gratuity calculation with the gratuity calculator in UAE 2023.

Also, keep in mind that the gratuity calculator implies continuous service between the first and last working day. As a result, in circumstances when employment is not continuous, the final settlement calculations performed by the gratuity calculator in Dubai must change accordingly.

2. Discover how the gratuity calculator in Dubai work

In the UAE, there are two types of work contracts: restricted contracts and unlimited contracts. The following is the rule for the gratuity calculator in the UAE under both of these types of contracts:

2.1 Calculating gratuity for an indefinite contract

2.1.1 Resignation

If an employee has an unlimited contract and resigns, the following rule applies for determining gratuity:

• Resignation before one year of employment is not eligible for a gratuity.
• If an employee resigns between one and three years of service, he or she is entitled to one-third of one year’s basic pay as a gratuity for the duration of work.
• If an employee resigns between 3 and 5 years of service, he or she is entitled to two-thirds of 21 days’ basic wage as a gratuity for the duration of work.
• After five years of service, the employee is entitled to 21 days’ basic pay for the first five years of work and 30 days’ basic pay for each consecutive year.

2.1.2 Termination

If an employee has an unlimited contract and his or her employment is terminated by the employer, the following rule for determining gratuity applies:

• Employees who are terminated before one year of service are not entitled to a gratuity.
• If you leave after more than a year but less than five years of employment, your gratuity will be calculated as 21 days’ basic wage for each year of service.
• After more than five years of service, the gratuity will calculate as 30 days’ basic salary for each year of service after the first five years and 21 days’ basic salary for the first five years.

The entire gratuity with the gratuity calculator UAE online should not surpass the base income for two years.

2.2 How to calculate gratuity for a limited contract?

If an employee has a limited contract, the following rule applies for determining gratuity:

• Employees who work for less than a year are not entitled to a gratuity.
• An employee is entitled to a gratuity of 21 days’ salary for each year of employment between one and five years.
• Employees with more than 5 years of service are entitled to a gratuity of 30 days’ salary for each year of work after the first 5 years, plus 21 days’ basic compensation for the first 5 years.

The gratuity calculator in the UAE assumes that the employee’s short-term employment contract has expired.

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