How the end-of-service award is calculated
Under Article 84 of the Saudi Labor Law, when employment ends the employee is entitled to:
- First five years: half a month's wage for each year.
- After five years: a full month's wage for each year.
- Parts of a year are paid in proportion to the time worked.
What you get when you resign (Article 85)
| Service | Share of the award |
|---|---|
| Under 2 years | Nothing |
| 2 to under 5 years | One third |
| 5 to under 10 years | Two thirds |
| 10 years or more | Full award |
Example
8 years at SAR 10,000 a month, contract ended: (5 × 5,000) + (3 × 10,000) = SAR 55,000. Resigning after the same period gives two thirds: SAR 36,666.67.
FAQ
Is the award based on basic salary only?
No. It uses your last actual wage: basic plus fixed allowances such as housing, unless your contract or company policy gives you more.
When do I get the full award even though I left?
If you left because of force majeure, for one of the reasons in Article 81 (for example, the employer breaching their obligations), or as a female employee ending the contract within six months of marriage or three months of giving birth.
When must the award be paid?
Within one week if the employer ended the contract, and within two weeks if the employee resigned.
This is an estimate. For special cases, check with the Ministry of Human Resources or a legal adviser.
How UAE end-of-service gratuity is calculated
Under Article 51 of Federal Decree-Law No. 33 of 2021 on the Regulation of Employment Relations, a full-time foreign employee who has completed one year or more of continuous service gets gratuity based on their last basic wage:
- First five years: 21 days' wage for each year.
- After five years: 30 days' wage for each year.
- Parts of a year count in proportion, once one year of continuous service is complete.
- Unpaid absence days are not counted as service.
- The total can never exceed two years' wage.
This calculator takes a day's wage as monthly basic salary ÷ 30, and caps the total at 24 months of basic salary.
Resignation under the new law
Decree-Law 33/2021 has no reduction for resignation. The old law (Federal Law 8 of 1980) cut or cancelled the gratuity of employees who resigned before five years of service. So this calculator gives the full gratuity whether you resigned, your contract ended or you were dismissed, as long as you served at least one year.
Example
8 years on a basic salary of AED 10,000: a day's wage is AED 333.33, so (5 × 21 × 333.33) + (3 × 30 × 333.33) = 35,000 + 30,000 = AED 65,000, whether you resigned or the contract ended.
FAQ
Is UAE gratuity based on basic salary only?
Yes. It uses the last basic wage you were entitled to. Allowances such as housing and transport are not included.
Do I lose part of my gratuity if I resign?
Not under the current law, as long as you completed one year of continuous service. Under one year there is no gratuity, whatever the reason the contract ended.
When must gratuity be paid?
Within 14 days of the contract ending, together with wages and other dues (Article 53). The employer may deduct amounts you owe under the law or a court judgment.
Does this apply to UAE nationals?
No. Emiratis are covered by the pensions and social security legislation. This calculator is for full-time foreign employees in the private sector.
This is an estimate. It does not cover part-time or flexible work, the DIFC and ADGM free zones (each has its own employment law), or employers that moved to the alternative savings scheme. To be sure, check with MOHRE or u.ae.