How gratuity is calculated according to UAE laws??

Question

How gratuity is calculated according to UAE laws??

Answer 1

According to UAE LABOUR LAWS gratuity is calculated as follows:-

Gratuity is calculated on an annual basis or part thereof provided that the employee has actually completed one year of employment with the employer or more. Days of absence from work without pay are not included in calculating the length of service. However, employee will be entitled to end of service gratuity for fractions of a year he spent in service provided that he has completed at least one year in continuous employment.

Without prejudice to what is stipulated by the policies of some establishments in the granting of pensions or retirement benefits to employees, gratuity for those who are paid monthly, weekly or daily wages is calculated according to the employee’s last received basic wage before the employment was terminated. This wage is the basis for calculating the gratuity for the whole period of an employee’s employment.

In the case of an employment agreement for a unilimited term, an employee who completes one year or more in continuous service shall be entitled to gratuity at the end of their service. The gratuity shall be calculated as follows:

(1) 21 days wages for each year of the first five years.

(2) 30 days wages for each additional year on condition that the total of the gratuity does not exceed the wages of two years.