Federal traditional gratuity rules

UAE Gratuity Calculation Guide

Understand eligibility, the 21-day and 30-day bands, partial service, unpaid absence, caps and Savings Scheme boundaries.

Reviewed by FinalPay UAE Research Desk: 3 August 2026Official-source interpretation, not legal advice
Direct answer

For eligible federal private-sector traditional gratuity, the calculation generally uses the last basic wage, 21 days for each of the first five years and 30 days for each later year, with eligible partial-year service and a two-year wage cap.

Decision supported

Eligibility, formula, service bands, partial years, unpaid absence and savings-scheme boundaries

Outside this page

ADGM and DIFC calculations

Confirm the system before calculating

Traditional gratuity, the federal Savings Scheme, ADGM gratuity, DIFC DEWS and domestic-worker rules should not be combined.

  • Identify jurisdiction.
  • Check Savings Scheme enrolment.
  • Confirm at least one eligible year for traditional federal gratuity.

Apply the service bands transparently

Show daily basic wage, service in each band, potentially excluded days and the cap as separate lines.

  • Basic wage ÷ 30
  • 21 days per eligible year through year five
  • 30 days per eligible year after year five
  • Maximum two years of wage where applicable

Reconcile the inputs

Most disputes concern wage basis, dates, unpaid absence or scheme status rather than arithmetic alone.

  • Contract and salary amendments
  • Start and end dates
  • Unpaid absence records
  • Savings Scheme statements

Official sources and limitations

Each source supports a defined part of this overview. It does not confirm your contract facts, payroll records or jurisdiction.

UAE Government: End-of-service benefitsMOHRE: Alternative End-of-Service Benefits System