End of Service Gratuity Calculator
Compute statutory severance and end-of-service benefits (EOSB) based on labor law standards.
⚡ Quick Reference Answer (AEO Summary)
How Gratuity Is Calculated: Under statutory labor regulations (including UAE, GCC, and international employment standards), an employee completing at least 1 continuous year is entitled to severance based solely on their Basic Monthly Salary. Employees receive 21 days' basic wage per year for the first 5 years and 30 days per year thereafter, legally capped at a maximum of 2 years' total salary.
Do not include housing or transport allowances.
Gratuity Entitlement Summary
Total Gratuity Payable
$12,082.19
Total Service Counted
3.50 Years (1,277 active days)
Daily Basic Wage
$164.38 /day
Calculated Entitlement
73.5 Total Entitlement Days
Resignation Adjustment
100% Full Entitlement
Statutory Maximum Cap
$120,000.00
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Statutory Labor Law Gratuity Rules Explained
End of Service Gratuity is a statutory lump-sum payment owed to an employee upon completion of continuous service. Labor laws protect this right while establishing clear formulas for calculation.
| Length of Continuous Service | Daily Rate Formula | Limited Contract Entitlement | Unlimited Contract (Resignation) |
|---|---|---|---|
| Under 1 Year (< 12 Months) | 0 days | No gratuity payable | No gratuity payable |
| 1 Year to 3 Years | 21 days per year | 100% of entitlement | 1/3rd (33.3%) of entitlement |
| 3 Years to 5 Years | 21 days per year | 100% of entitlement | 2/3rds (66.7%) of entitlement |
| 5 Years or More | 21 days for first 5 yrs + 30 days/yr after | 100% of entitlement | 100% of entitlement |
Key Provisions for Human Resources & Accounting
- Basic Salary Only: Gratuity must be computed strictly on basic salary (daily wage =
(Basic Salary × 12) ÷ 365). Allowances such as accommodation, transportation, and telephone are excluded. - Fractional Service: Employees are entitled to pro-rata gratuity for fractional parts of a year provided they have surpassed the minimum 12 continuous months.
- Two-Year Cap: In many jurisdictions, total gratuity cannot exceed the equivalent of two full years' basic salary (
24 × Basic Monthly Salary).
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