Easy Way to Calculate Your Gratuity or “End of Service” Pay in UAE

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how to calculate gratuity

Easy Way to Calculate Your Gratuity or “End of Service” Pay in UAE

Ministry of Human Recourses and Emiratisation authoritatively declared gratuity pay for domestic workers UAE. As indicated by the Domestic Workers Law, the homegrown labourer has the privilege to pay wages, clinical affirmation, 12-hour rest every day, one day of paid rest every week, 30-day clinical leave every year, a pass to arrive and back home at ordinary spans, and various benefits. 

When the contract gets over between domestic worker and employer, they have the privilege to get the finish of services or gratuity pay. Law states that domestic workers will have the right of getting paid at a finish of-services gratuity upon the end of his services, if he”having gone through one year or more inconsistent help “. Suppose you are serving in UAE as a domestic worker.

In that case, you should have an idea about calculating methods of gratuity pay which is your right. This post will discuss how gratuity pay for domestic workers in the UAE is calculated. 

When you wrapped up your work agreement with your employer, your pay is figured dependent on the latest salary paid to your account. To address this concern, article 134 states that, end of services tip will be determined based on the last salary to the month to month, week after week, and day by day paid labourers.” It does exclude stipends or bonuses. 

If you decide not to continue your work agreement after one year, you still have the right to gratuity pay. However, article 139 states that you won’t get it’s anything but: “(a) are excused from services for any of the reasons set out in Article 120 (for example embracing a bogus personality, forging documents and so forth); and (b) leave your work voluntarily and without notice.” 

Types of Contracts 

The nature of the agreement you have will likewise decide your gratuity pay. The two essential kinds of deals in the UAE are limited agreements and limitless agreements. 

As the name reflect, a limited agreement is a “fixed-term” contract where you consent to work with an organization for a particular number of years. On the off chance that you leave before the set “end date,” you may confront a work boycott or even be approached to pay to your boss. 

A limitless agreement is the opposite of a limited contract. It excludes a particular period and has no closure date. For this situation, either the worker or boss needs to allow a one-month as long as three-month notice period before ending the agreement. 

Figure out how to calculate your end-of-service pay

To determine Gratuity Pay for Limited Agreements. 

The accompanying principles apply for those with limited agreements: 

Under 1 Year of Service – No gratuity pay 

  • 1 Year to 5 Years of Service – Full gratuity dependent on 21-day salary for every time of service 
  • Over 5 Years of Service – Full gratuity dependent on 30-day pay for a whole year
  • For instance, if you have a basic salary of AED 12,000 and worked for three years.
  • AED 400 (every day wage) = AED 12,000/30 days 
  • AED 8,400 (21-day salary) = AED 400 x 21 days 
  • AED 25,200 (gratuity pay) = AED 8,400 x 3 years 
  • You have the right to the end of service gratuity pay of AED 25,200. 

Determine Gratuity Pay for Unlimited Agreements 

Following are the basic principles for unlimited agreements.

  • Under 1 Year of Service – No gratuity pay 
  • 1 Year to 3 Years of Service – 33% (1/3) of 21-day gratuity pay 
  • 3 Years to 5 Years of Service – 66% (2/3) of 21-day gratuity pay 
  • Over 5 Years of Service – Full 21-day gratuity pay 
  • For instance, on the off chance that you have an essential salary of AED 12,000
  • AED 400 (day by day wage) = AED 12,000/30 days 
  • AED 400 (day by day wage) = AED 400 x 21 days 
  • AED 2,800 (33% gratuity pay) = AED 8,400 x 0.33 
  • AED 5,600 (66% gratuity pay) = AED 8,400 x 0.66 

You will have the right to AED 2,800 on the off chance that you worked somewhere between 1 and 3 years; AED 5,600 if you worked somewhere in the range of 3 and 5 years; and AED 8,400 if you worked for over five years. 

Suppose you are currently serving in UAE as a domestic worker or looking to join this stream. In that case, you must know about the gratuity calculating method. This method helped you a lot, and it will not let your employer cheat on you, which terminates many future problems.

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