Gratuity after 8 years
How is gratuity calculated for someone who worked 8 years?
The situation
The first 5 years earn 21 days of basic wage each, and each year after that earns 30 days. The total is capped at 2 years' wage.
The law
- Art 51, Federal Decree-Law 33 of 2021: End of service gratuity: 21 days basic wage a year for the first 5 years, 30 days after, capped at 2 years' wage
What it means for you
Example with AED 12,000 basic: daily wage AED 400. First 5 years: 105 days, AED 42,000. Next 3 years: 90 days, AED 36,000. Total AED 78,000, well under the cap of 2 years' wage. Part years are pro-rated.
What to do
- Split service into first 5 years and after.
- Apply 21 and 30 days.
- Check the 2-year cap.
- Pay within 14 days.
We can do this for youPayroll compliance: WPS salary runs, end of service gratuity, final settlement and payroll records: AED 95