Under Federal Decree-Law No. 33 of 2021, Article 51, a UAE private-sector worker who completes at least one full year of continuous service earns end-of-service gratuity of 21 days’ basic wage for each of the first five years, and 30 days’ basic wage for each year after that. The wage basis is basic wage ONLY — housing, transport and other allowances are excluded. The daily wage is monthly basic divided by 30 (Cabinet Resolution No. 1 of 2022). Partial years are prorated, unpaid absence days are excluded, and the total is capped at two years’ wages.
The biggest myth to kill: there is NO resignation reduction under current law. The old pre-2022 tiers (one-third, two-thirds under the repealed Law 8/1980) are gone — yet most page-one articles still teach them. If you resign, you get the same formula as if you were terminated. The only way to lose gratuity is summary dismissal for gross misconduct under Article 44.
Worked example: basic AED 12,000 per month, 7 years, resigned. Daily wage = 12,000 / 30 = AED 400. Years 1–5: 400 x 21 x 5 = AED 42,000. Years 6–7: 400 x 30 x 2 = AED 24,000. Total = AED 66,000 (the two-year cap of AED 288,000 is not hit).
Sources: UAE Federal Decree-Law No. 33 of 2021, Article 51; MOHRE official pages; Cabinet Resolution No. 1 of 2022.
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