1. What is End of Service Gratuity?

End of Service Gratuity is a legal entitlement for employees in Dubai and the UAE upon termination of employment. It is calculated based on the employee's final salary and length of service, providing financial compensation for years worked.

2. How Does the Calculator Work?

The calculator uses the Dubai gratuity formula:

Where:

• \( Last\ Salary \) — Final monthly salary in AED
• \( \frac{21}{30} \) — Daily wage calculation factor
• \( Years \) — Total years of service

Calculation Rules:

• Less than 1 year: No gratuity
• 1-5 years: 21 days' basic salary for each year
• More than 5 years: 21 days' basic salary for first 5 years + 30 days' basic salary for each additional year

3. Importance of Gratuity Calculation

Details: Accurate gratuity calculation ensures employees receive their legal entitlements and helps employers comply with UAE labor laws. Proper calculation prevents disputes and ensures fair compensation for service.

4. Using the Calculator

Tips: Enter your last monthly basic salary in AED and total years of service. The calculator will automatically apply the correct formula based on your service duration. Ensure accurate salary figures for precise results.

5. Frequently Asked Questions (FAQ)

Q1: What salary component is used for gratuity calculation?
A: Only the basic salary is used for gratuity calculation, excluding allowances, bonuses, and other benefits.

Q2: Are part-time years counted?
A: Yes, all years of continuous service are counted, regardless of full-time or part-time status.

Q3: What happens if employment is terminated before 1 year?
A: No gratuity is payable for service less than 1 year, unless specified in the employment contract.

Q4: Is gratuity taxable?
A: No, end of service gratuity is tax-free in the UAE.

Q5: What if I resign vs. being terminated?
A: Different rules may apply. This calculator assumes standard termination scenarios. Consult HR for specific cases.