UAE gratuity on a limited contract — how it works since 2022
Since Federal Decree-Law No. 33 of 2021 took effect in February 2022, every private-sector contract in the UAE is fixed-term. The old limited/unlimited split is gone — and with it the rule that resigning cut your gratuity.
21 days’ basic pay for each of the first 5 years, then 30 days per year — capped at two years’ basic salary.
Open the free End-of-Service Gratuity tool below.
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Frequently asked questions
Do unlimited contracts still exist in the UAE?
No. Federal Decree-Law No. 33 of 2021 converted all private-sector employment to fixed-term contracts, and employers were given a transition period to move existing staff across. Older guidance that splits gratuity rules by limited vs unlimited contract is out of date.
Does resigning reduce my gratuity in the UAE?
No. Under the current law resignation and employer termination are treated the same. The only case that forfeits gratuity is dismissal for gross misconduct under Article 44.
Is UAE gratuity based on basic or total salary?
Basic salary only. Housing, transport and other allowances are excluded, which is why your gratuity is usually lower than a calculation on your total package would suggest.
Does this apply in DIFC and ADGM?
No. DIFC and ADGM run their own employment regimes — DIFC replaced end-of-service gratuity with the DEWS savings scheme. This calculator covers mainland UAE contracts.