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End-of-Service Benefit (EOSB) for a limited or unlimited contract under the UAE Labour Law.
Formula
First 5 years: 21 days’ basic pay per year. After 5 years: 30 days’ basic pay per year. Daily pay = basic / 30. On resignation with 1-3 years service only 1/3 is payable; 3-5 years, 2/3; 5+ years, full. Total is capped at 2 years’ basic salary.
Worked example
AED 10,000 basic, 6 years, employer-ended: (5 × 21 + 1 × 30) days = 135 days × (10000/30) = AED 45,000.
Quick reference
| Basic | 3 yr | 5 yr | 8 yr |
|---|---|---|---|
| AED 8,000 | AED 16,800 | AED 28,000 | AED 52,000 |
| AED 15,000 | AED 31,500 | AED 52,500 | AED 97,500 |
| AED 25,000 | AED 52,500 | AED 87,500 | AED 1,62,500 |
Employer-ended / full-term, before the 2-year cap.
Frequently asked questions
Who is entitled to gratuity in the UAE?
Any employee who completes at least one year of continuous service is entitled to an end-of-service gratuity on leaving, calculated on the last basic salary (excluding allowances).
How does resignation affect UAE gratuity?
Under the older unlimited-contract rules, resigning between 1 and 3 years of service paid one-third of the gratuity, 3 to 5 years paid two-thirds, and over 5 years paid the full amount. Newer fixed-term contract rules pay the full accrued amount regardless of who ends it - check your contract and the current law.