The calculations for gratuity may not be same for all as a lot depends on whether you’re on a Limited (Fixed Term) contract or Unlimited (Undefined) contract, your length of service and last but not the least how your salary has been structured. Apart from these factors, your gratuity pay is worked out basis your most recent/ last salary.
In case you are terminated from your job, unless you break the rules as stated in Article 139 of the Labour Law, as an employee you are entitled to gratuity. However, if you as an employee resigns on his or her own free will before completing one year, than you aren’t entitled to any gratuity.
Here is how to do it:
Basic salary example: Dh10,000
a. 10,000 ÷ 30 = 333.30. Your daily wage is Dh330.30
b. 330.30 x 21 = 6,936.30. So 21-days salary is Dh6,936.30 in gratuity entitlement for each year of service. Multiply this figure for every year of service up to 5 years.
For 30 days calculation for those exceeding 5 years of service
c. 330.30 x 30 = Dh9,909. So 30-days salary is Dh9,909 in gratuity entitlement for each year of service – so long as the total figure does not exceed two years total salary figure.
Calculations for Unlimited Contract gratuity pay