Most people leaving a UAE job know they are owed gratuity. Far fewer know that gratuity is one of four or five separate entitlements, or that they are calculated on different salary figures — which is where settlements quietly go wrong.
The three salary bases
This is the part that causes more disputes at MOHRE than anything else. A settlement does not use one salary figure. It uses three.
| Component | Calculated on | Authority |
|---|---|---|
| End-of-service gratuity | Basic salary only | Article 51 |
| Unused annual leave | Basic salary only | Article 29(9) |
| Pay in lieu of notice | Full package | Article 43 |
| Outstanding salary | Full package | Contractual |
The effect is not trivial. On a package of AED 15,000 made up of AED 10,000 basic and AED 5,000 in housing and transport allowances, twenty unused leave days are worth AED 6,667 — not AED 10,000. Employees routinely expect the higher number. Employers, equally routinely, apply the basic-only rule to notice pay where it does not belong.
Gratuity
Twenty-one days of basic salary for each of the first five years of service, then thirty days of basic salary for each year beyond five. The total is capped at two years of basic salary however long you stayed. Less than one full year of continuous service means no entitlement at all; partial years beyond the first are counted proportionally.
Unused annual leave
Thirty calendar days accrue per year once you pass one year of service, and two days per month between six and twelve months. Below six months, nothing is due — though those months still count toward continuous service for gratuity.
Accrued leave is not forfeited by resigning. If an employer tells you otherwise, they are wrong.
Notice period
If you serve your notice, nothing extra is payable — you were being paid anyway. If your employer terminates without notice, they owe you your full-package wage for the notice period. If you leave without serving it, you owe them the same amount, and it comes out of your settlement.
Outstanding salary and other items
Any days worked but unpaid, calculated on full package. A repatriation air ticket where your contract provides one. Against these, an employer may deduct outstanding loans, salary advances, and unreturned company property.
The 14-day deadline
Employers must settle everything within fourteen days of your last working day. Not gratuity within fourteen days and the rest whenever — the whole settlement. If that passes without payment, MOHRE is the route.
One thing worth knowing: since 1 June 2026, private-sector salary payments including final settlements are required to flow through the Wages Protection System. A settlement paid in cash sits outside that record, which creates a compliance problem for the employer on top of whatever the underlying dispute is.
Before you sign anything
Ask HR for the settlement broken down line by line, showing which salary figure was used for each component. A settlement presented as a single number is impossible to check, and that is often the point.
Run your own figures first with the Final Settlement Calculator, which itemises all of it and labels the basis used for each line. If you only need the end-of-service portion, the Gratuity Calculator handles that alone. Unpaid overtime frequently surfaces at this point too — the Overtime Calculator covers the 125 and 150 per cent rates.
General information, not legal advice. DIFC and ADGM operate under separate employment legislation with different rules.