In this article, we will detail UAE labour law end of service gratuity in 2024, including the eligibility criteria, calculation methods, and important provisions.
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Table of Contents
UAE labour law end of service gratuity details
Eligibility for Gratuity: End-of-service gratuity applies to expatriate workers in the UAE. These provisions do not cover UAE nationals, as they are entitled to mandatory National pension plans.
For expatriate workers, eligibility for gratuity arises at the end of their service period, whether due to termination or resignation.
According to Article 51 of UAE Labour Law, employees are entitled to a fraction of the year worked provided they have completed more than one year of continuous service.
Basis for Gratuity Calculation.
The basis amount used to calculate gratuity is the employee’s last drawn basic salary. It’s important to note that any outstanding amounts owed to the employer may be deducted from the gratuity paid by the employer before settlement.
Limit on Gratuity.
While end-of-service gratuity is a valuable benefit, it’s important to be aware of the limit on the amount payable during final settlement. According to UAE Labour Law, the gratuity payable to an employee cannot exceed the equivalent of the employee’s total two-year salary.
Learn about asking the employer for a settlement agreement in UAE.
Accrual of Gratuity.
The calculation of gratuity accrues based on a set number of days for each year of service. Here’s how it works:
- For the first five years of service, gratuity accrues at a rate of 21 days per year.
- From the sixth year onwards, gratuity accrues at 30 days per year.
Read about UAE Labour Law Resignation Gratuity Dubai, and learn about Retirement Age as per UAE Labour Law.
FAQs about end of service gratuity in UAE
Conclusion.
End-of-service gratuity is a significant aspect of UAE Labour Law, ensuring expatriate workers are rewarded for their dedication and service.
Understanding the eligibility criteria, basis for calculation, and limits on gratuity is essential for employers and employees.
Suppose you have any questions or concerns regarding end-of-service gratuity or other labour-related matters. In that case, seeking guidance from legal experts like Al Mulla Lawyer & Legal Consultant is advisable.
With his extensive expertise in labour cases in the UAE, they can provide invaluable assistance in safeguarding your rights and ensuring fair treatment in the workplace.
Contact Al Mulla Lawyers today! Click the Whatsapp icon below or visit our Contact Us page.
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A legal consultant specializing in UAE labor law. He regularly publishes articles on the website and writes on various areas of UAE law, with a specific focus on labor law.
