gratuity calculator uae 2020 New way to calculate

gratuity-calculator-uae

The United Arab Emirates labor law clearly has stated that the Employer companies are responsible to pay end service compensation to the employees depending on the years of the services. The gratuity calculator UAE has been developed on the provision of the labor law of the UAE so, it will calculate the gratuity amount that you may entitle after ending your relationship with the employer.

Before you calculate the gratuities, you should be aware of the types of contracts that you signed with the former employer. There are two types of contracts available in UAE.

  1. Limited contract: This contract is signed for a certain time, for example, 1yrs, 2yrs  or 3yrs contracts. Once your contract has been completed, you may either go back home or continue working with employers after renewing it.

Many people are confused here for understanding the limited and unlimited contract, so, I think this example will help you to understand it.

Look; you singed the limited contract with your employers for 2yrs. After completing 2yrs you need to go back to your country or make a new contract for 2yrs again. Every two years you need to sign a new contract with your employer, This process can go as long as both parties agree upon it.

Along with the contract, you should renew your visa, labor card and other official documents to work and stay in this country.


Limited Contract Gratuity calculator in UAE 


2. Unlimited contract: This contract is no time frame, the contract signs one time and go for many years unless you or employer want to terminate it. example;

Every two years you need to renew your visa, residential permit, and labor card but the previously signed contract remains valid neither it needs to make new or renewal.


Unlimited Contract Gratuity calculator UAE 


In the limited contract, you should renew your contract along with your visa, labor card and residential permit. The fundamental difference between these contracts is a necessity for renewal and not necessary for renewal.

How does the gratuity calculate in UAE?

Not everybody will entitle to the gratuity, because, there are various terms and conditions will involve for end service compensation. The employer will calculate the end service benefit for the employees after termination of the Unlimited or limited contract.

No gratuity pay conditions; 

  • If you leave the job before completing the 1 year.

Employer dismiss you without notice cause of following;

      1. If it is found that you submitted a false identity or nationality or submits forged certificates or documents to obtain a visa and job.
      2. You are engaged on probation and is dismissed during or at the end of the
        a probationary period;
      3. commits a fault resulting in a substantial material loss to the employer,
        provided that the latter notifies the labor department of the incident within
        48 hours of your becoming aware of its occurrence;
      4. disobeys instructions on the safety of work or workplace, provided that such
        instructions are in writing and posted at a conspicuous place and are
        communicated verbally to the worker, in case he is illiterate;
      5. defaults on his basic duties under the contract and fail to redress such default
        despite a written interrogation and a warning that he will be dismissed if such
        default is repeated;
      6.  finally convicted by a competent court of a crime against honor, honesty or
        public morals
      7. reveals any confidential information of his employer;
      8.  found in a state of drunkenness or under the influence of a narcotic drug
        during working hours;
      9. assaults the employer, the manager in charge or any of his workmates during
        working hours; or
      10. absents from work without a valid reason for more than 20 nonsuccessive days in one single year, or for more than seven successive days

Despite, your dismissal from the employer based on the above reasons if you are victim of the following will entitle to gratuity.

  1. If the employer fails to honor his obligations towards you, as provided for in the contract or in this Law.
  2. If you are assaulted by the employer or the employer’s legal representative

How does the gratuity calculate in the UAE?

Although our end of service calculator UAE will calculate an exact amount for your gratuity here is the formula for making you easy to understand;

The gratuity calculation formula for Limited contract

  1. Leaving the job less than 1yrs = no gratuity.
  2. Completion 1yrs to 5yrs tenure = 21days salary for each year.  formula;
      • (21*basic salary/30*years of services= Gratuity amount)
      • suppose your basic salary is 3000 and have completed 4yrs now gratuity is
      • 21*3000/30*4 = gratuity AED 8400
  3. Working longer the 5yrs = 30days salary for each year’s formula;
      • (30*basic salary/30*years of services= Gratuity amount)
      • suppose your basic salary is 3000 and have completed 6yrs now gratuity is
      • 30*3000/30*6 = gratuity AED 18000

The gratuity calculation formula for an unlimited contract;

  1. Leaving the job less than 1yrs = no gratuity.
  2. Completion 1yrs to 3yrs tenure = 7days salary for each year.  formula;
      • (7*basic salary/30*years of services= Gratuity amount)
      • suppose your basic salary is 3000 and have completed 2yrs now gratuity is
      • 7*3000/30*2 = gratuity AED 1400
  3. Completion 3yrs to 5yrs tenure = 14days salary for each year.  formula;
      • (14*basic salary/30*years of services= Gratuity amount)
      • suppose your basic salary is 3000 and have completed 4yrs now gratuity is
      • 14*3000/30*4 = gratuity AED 5600
  4. Completion More than 5yrs = 21days salary for each year.  formula;
      • (21*basic salary/30*years of services= Gratuity amount)
      • suppose your basic salary is 3000 and have completed 7yrs now gratuity is
      • 21*3000/30*7 = gratuity AED 14700

Gratuity in UAE is the provision of the federal labor law, so, it is applicable everywhere in the UAE regardless of the territory of the organization. If you are looking for the gratuity calculator Dubai, you should use the above calculator, because, Dubai has not any different calculator and the labour law.

Conclusion: This gratuity calculator UAE has developed based on the UAE labour law and calculates the accurate data that you may entitle. If the employer does not want to pay the gratuity you can report to MOHRE (ministry Of The Human Resource and Emiratisation) or suit the labour court of the UAE.

Labour law UAE pfd

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