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HR MATTERS | May 01, 2022
Are you planning to resign from your current job? Have you been terminated, or leaving the UAE for good?
Under the UAE Labour Law, an expatriate employee who has completed at least one year of continuous service is entitled to an end of service gratuity payment on termination of employment. This is paid after the termination of the employment contract on an accumulated basis for the tenure served.
Your total gratuity depends on the following factors:
Previously, there were two types of contracts in the UAE* - limited contracts and unlimited contracts. However, with the recent changes in labour law, effective as of February 2, 2022, all employment contracts are now to be converted into limited contracts with a validity of up to 3 years.
The old gratuity calculation scheme shall apply to all private sector employees under unlimited contracts until their contracts are renewed to limited within the coming year. Companies have until February 2023 to renew all employee contracts. Regardless of your type of contract, gratuity is calculated using the employee’s basic salary excluding all additional allowances or bonuses.
To calculate your end of service gratuity, visit the UAE Ministry of Human Resources and Emiratisation (MOHRE) website.
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