UAE End of Service Gratuity (EOSG): Complete 2026 Calculation Framework

Statutory Gratuity Rules Under Federal Decree-Law No. 33

The United Arab Emirates Labor Law guarantees an End of Service Gratuity (EOSG) for full-time employees completing at least one year of continuous service:

The Mathematical Formula:

• First 5 Years of Service: 21 days' basic wage for each completed year.
• Beyond 5 Years of Service: 30 days' basic wage for each additional year.
• Maximum Ceiling: Total gratuity payout cannot exceed two years' gross basic salary.
• Pro-Rata Fractions: Calculated proportionally for completed fractions of a year.

Worked Example: 7 Years of Service at AED 18,000 Basic Salary

• Basic Salary: AED 18,000 / month (Daily Wage = 18,000 / 30 = AED 600).
• Years 1 to 5 (5 years × 21 days × AED 600): AED 63,000.
• Years 6 and 7 (2 years × 30 days × AED 600): AED 36,000.
• Total Statutory Gratuity Payout: AED 99,000 (well below the 2-year cap of AED 432,000).