Under the ADGM Employment Regulations 2024 framework, the Basic Wage used to calculate gratuity cannot be less than 50% of Annual Wages. If the stated Basic Wage falls below that floor, the gratuity calculation needs the higher floor amount.
The ADGM gratuity Basic Wage floor calculation
What it cannot determineWhether gratuity is due in a disputed termination
Enter the facts you can verify.
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ADGM guidance says Basic Wage used for gratuity must not be less than 50% of Annual Wages. This calculator applies the floor only to the gratuity wage basis.
Formula used
Effective gratuity Basic Wage = greater of stated Basic Wage or 50% of Wages. The ADGM gratuity daily rate is then based on annual Basic Wage ÷ 365 in the separate gratuity calculation.
Assumptions to verify
- The entered figures match the ADGM definitions of Basic Wage and Wages.
- The employee is covered by the ADGM Employment Regulations 2024.
- The wage figures represent the relevant period used for the gratuity calculation.
What this result does not prove
- Variable payments that fall outside the applicable ADGM Wage definition.
- Whether gratuity is payable in a disputed termination scenario.
- Salary, unused vacation, notice and other final-settlement lines.
Why the 50% floor exists in the calculation
An ADGM employment package may separate Basic Wage from other Wages. For gratuity, simply copying a very low contractual Basic Wage can understate the required wage basis if it falls below the regulatory floor. This checker makes that comparison visible before the service-year formula is applied.
Example: Basic Wage below the floor
If monthly Wages are AED 20,000 and the stated Basic Wage is AED 8,000, 50% of Wages is AED 10,000. The gratuity wage-basis check therefore uses AED 10,000 rather than AED 8,000. If the stated Basic Wage were AED 12,000, the AED 12,000 figure would remain above the floor.
Do not use the floor as the whole ADGM settlement
The floor affects the gratuity wage basis. Salary through termination, unused vacation, notice, additions, deductions and the ADGM payment window are separate lines. Use the ADGM Final Settlement Calculator for the complete exit review.
Evidence to keep
- Employment contract and wage schedule.
- Recent payslips showing Basic Wage and other wage components.
- Any salary amendment effective before termination.
- The employer's gratuity breakdown showing the wage basis actually used.
Official sources
The links below are the primary references used for the rule or service described on this page. Check the live version before relying on a result.
Check the current official text, your contract, actual dates and records. Where facts are disputed, use the relevant authority or a qualified UAE professional.
Review official sourcesUse the effective wage basis in the ADGM settlement calculator