What is End-of-service gratuity?
End-of-service gratuity is the lump sum a UAE employer owes an employee with at least one year of continuous service, calculated on basic salary under Federal Decree-Law No. 33 of 2021.
End-of-service gratuity explained
Under Federal Decree-Law No. 33 of 2021, an employee who completes one year of continuous service is entitled to 21 days' basic salary for each of the first five years, and 30 days' basic salary for each year thereafter. Total gratuity is capped at two years' pay.
The calculation runs on basic salary only — housing, transport and other allowances are excluded — which is why the split between basic and allowances in the employment contract materially changes the final figure.
Gratuity is the most frequently disputed line in a UAE final settlement. An HR system that shows the calculation basis, not just the result, removes most of that friction.
Free zone regimes can differ. DIFC replaced gratuity with the DEWS funded workplace savings scheme for most employees.
How NeuralHR.AI handles End-of-service gratuity
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Let the system handle End-of-service gratuity
NeuralHR.AI enforces UAE and Saudi HR rules inside the product — WPS, gratuity, Emiratisation, GOSI, Qiwa and Mudad — so your team is not tracking them by hand.