UAE gratuity is not based on your full salary. It is based on your basic salary, which is often much lower than your total pay.
What counts
Article 51 of Federal Decree-Law No. 33 of 2021 bases gratuity on the last basic wage you received. Basic salary is the fixed monthly amount in your contract, before allowances.
What does not count
- Housing allowance
- Transport allowance
- Phone, food or utility allowances
- Bonuses and commission
- Overtime pay
- Other allowances and benefits in kind
An example of the difference
Someone earns AED 10,000 a month: AED 5,000 basic, AED 3,000 housing and AED 2,000 transport. After 5 years:
| Based on | Daily rate | Days | Gratuity |
|---|---|---|---|
| Basic salary (AED 5,000) | 166.67 | 105 | AED 17,500 |
| Total salary (AED 10,000) | 333.33 | 105 | AED 35,000 |
Many people expect the second row, but the formula gives the first. A lower basic salary means a lower gratuity.
How to find your basic salary
- Your employment contract or job offer should list basic salary and allowances separately.
- A payslip may show the salary split into its parts.
- HR can confirm the basic salary registered for you.
If your contract shows only one total, ask HR how it is split. To see what a 40%, 50% or 60% basic pays, use the basic salary calculator.
Why the split matters
Gratuity and some other entitlements use basic salary, so the split affects you directly. When comparing job offers, look at the basic salary as well as the total.
Calculate yours
Enter your basic salary and dates in the UAE gratuity calculator. For the steps, read how UAE gratuity is calculated.
Official text: Federal Decree-Law No. 33 of 2021 · Cabinet Resolution No. 1 of 2022
Work out your own figure
Enter your own numbers to see the result and the working.
Open the calculatorarrow_forwardThis guide is general information, not legal advice. Check your own entitlement with MOHRE or a qualified adviser. See our Disclaimer.
