UAE End of Service Gratuity 2026: Calculation & Dispute Guide

Private-sector employees in the UAE who complete at least one year of continuous service are legally entitled to an End of Service Gratuity. This is a mandatory statutory benefit paid by the employer at the end of your employment contract, calculated using your final basic salary and total years of service.

Key Takeaways: 2026 UAE Gratuity Rules ( Find Live Calculator Below)

• Eligibility: You must complete exactly one year (365 days) of continuous service to qualify.
• The Math: You accrue 21 days of basic pay for the first 5 years, and 30 days for every year after.
• The Cap: Your total gratuity payout cannot exceed two years’ worth of your salary.

What is the UAE End of Service Gratuity 2026?

The End of Service Gratuity is a financial safety net mandated by UAE Labour Law for private-sector workers. It acts as a severance package for expatriate employees who do not qualify for the UAE pension system. Whether you resign or are terminated, you are entitled to this payout as long as you have crossed the one-year service threshold — a 2022 amendment removed the old rule that reduced gratuity for resigning employees, so resignation no longer cuts your payout.

Two things can reduce or remove your entitlement. Any days of unpaid absence are excluded when counting your service period, so they don’t count toward your years of service. And if you’re dismissed for gross misconduct under Article 44 of the Labour Law, you forfeit the gratuity entirely — this is different from an ordinary termination or layoff, which doesn’t affect your entitlement.

How to Calculate Your Gratuity Final Settlement

Gratuity is calculated using your basic salary only. This means allowances for housing, transport, or utilities shown on your contract are excluded from the math.

Here is how the calculation works in 2026:

• Under 1 Year of Service: AED 0 (No entitlement).
• Years 1 to 5: You are owed 21 days of your basic wage for each year worked.
• Over 5 Years: You are owed 21 days for the first five years, plus 30 days of basic wage for every additional year worked.

Note: Partial years are prorated down to the exact day. Your final payout is subject to a legal cap and cannot exceed the equivalent of 24 months of your basic wage.

Documents Required for Your Final Payout

To process your Final Settlement and clear your visa, your HR department will require specific documentation to verify your identity and calculate your final working day.

You must prepare:

• Your MOHRE-registered employment contract (to verify your basic salary).
• Your most recent payslip.
• A copy of your Emirates ID and Passport bio page.
• Your official resignation letter or your employer’s termination notice (to legally establish your final end date).
• Your bank account IBAN for the final transfer.

What to Do If Your Employer Refuses to Pay

If your employer delays your Final Settlement, attempts to calculate your gratuity using your gross salary instead of your basic salary, or refuses to pay you entirely, you have immediate legal recourse.

How to pursue a dispute:

Court Escalation: If the employer still refuses, MOHRE will refer the case to the UAE Labour Courts for a binding legal judgment.

Do not sign the cancellation paper: Never sign a document stating you have received your final dues if the money is not in your bank account.

File a MOHRE Complaint: You can open a labour dispute directly with the Ministry of Human Resources and Emiratisation (MOHRE). There is AED 0 fee to open this complaint.

Mediation: MOHRE will contact your employer to mediate the calculation.