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Dubai Trade UAE End-of-Service Gratuity Formula:
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End of Service Gratuity is a legal entitlement for employees in the UAE who complete one or more years of continuous service. It is calculated based on the employee's basic salary and years of service according to UAE labor law provisions.
The calculator uses the Dubai Trade UAE gratuity formula:
Where:
Explanation: This formula calculates the end-of-service benefit based on 21 days' basic salary for each year of service, following UAE labor law standards.
Details: Accurate gratuity calculation ensures employees receive their legal entitlements and helps employers comply with UAE labor regulations. Proper calculation prevents disputes and ensures fair compensation for service years.
Tips: Enter basic salary in AED (excluding allowances), years of service in decimal format (e.g., 2.5 years). All values must be valid positive numbers.
Q1: What Is The Legal Basis For This Calculation?
A: This calculation follows UAE Labor Law Article 132, which mandates end-of-service benefits for employees completing one or more years of continuous service.
Q2: Does This Apply To All Employment Types?
A: The calculation applies to unlimited contracts. Limited contracts may have different calculations based on contract completion or early termination.
Q3: What If Service Is Less Than One Year?
A: Employees with less than one year of service are not entitled to gratuity under UAE labor law.
Q4: Are There Different Rates For Different Service Periods?
A: Yes, for service 1-5 years: 21 days per year; over 5 years: 30 days per year for additional years.
Q5: What Salary Component Is Used For Calculation?
A: Only basic salary is used for gratuity calculation. Housing, transportation, and other allowances are excluded.