Free zones: which law decides your gratuity

“I work in a free zone” tells you less than people think. Most free zones apply the federal labour law to gratuity, so everything on this site holds. Two do not, and in those two almost nothing on this site applies.

The short answer

Which employment law governs end-of-service pay, by where the employer is licensed.
Where your employer is licensed	Law on gratuity	First stop for a dispute
Mainland (any emirate)	Federal Decree-Law No. 33 of 2021, Article 51	MOHRE
Non-financial free zones — JAFZA, DMCC and most other non-financial zones	The federal law, with the free zone's own employment rules on procedure	The free zone authority, then the courts of the emirate
Dubai International Financial Centre (DIFC)	DIFC Employment Law No. 2 of 2019 — monthly DEWS contributions since 1 February 2020	DIFC Courts
Abu Dhabi Global Market (ADGM)	ADGM Employment Regulations 2024, section 61	ADGM Courts

The deciding fact is where your employer is licensed, not where you sit. A mainland company with an office in a free-zone tower is a mainland employer. A DIFC-licensed firm with staff working from home in Sharjah is a DIFC employer. Your visa page, your work permit and your employment contract will name the licensing authority. Look there first.

Non-financial free zones: the federal law applies

The federal decree-law applies, by Article 3(1), to "all establishments, employers and workers in the UAE private sector", and the only categories Article 3(2) takes out are government employees, the armed forces and security services, and domestic workers. Free-zone employees are not on that list. The UAE Government's own end-of-service page says the federal savings scheme "applies to employers and employees in the private sector and free zones" — which only makes sense because free-zone employment sits inside the federal end-of-service system.

So for an employee of a JAFZA or DMCC company, the gratuity is the ordinary Article 51 calculation: 21 days' basic wage for each of the first five years, 30 days for each year after, nothing below one year, capped at two years' wage, payable within 14 days. Everything in how gratuity is calculated and the calculator applies.

What is different in a free zone

Who issues your permit. The free zone authority, not MOHRE, usually issues and cancels your work permit or employment card. That changes which office handles the paperwork when you leave.
Where disputes start. Jafza, for example, asks employees to register a complaint with Jafza, which aims for an amicable settlement within 10 working days of registration and otherwise passes the case to the Dubai Courts. Other zones have their own processes. MOHRE is not normally the first stop for a free-zone employee.
Zone rules on top. Several zones publish their own employment regulations on matters such as permits, contracts and dispute procedure. Where they deal with gratuity they generally follow the federal formula. If your contract or the zone's rules promise more, the more generous term usually stands; they cannot promise less than the statute.

DIFC: savings, not a calculation

The Dubai International Financial Centre has its own Employment Law, DIFC Law No. 2 of 2019. Since 1 February 2020 a DIFC employer has paid monthly contributions for each eligible employee into a qualifying scheme — usually DEWS, the DIFC Employee Workplace Savings plan — instead of paying a lump sum at the end. Article 66(7) of the DIFC law sets the contributions at 5.83% of monthly basic wage for the first five years of service and 8.33% for each year after.

Service before 1 February 2020 is treated differently: a gratuity on the old 21-day and 30-day basis for that earlier period, unless it has been transferred into the scheme. The details are in DIFC DEWS explained. The short version is that the calculator on this site does not describe a DIFC employee's position at all.

ADGM: a gratuity, with its own rules

Abu Dhabi Global Market keeps an end-of-service gratuity, on a formula that looks familiar — 21 days' basic wage a year for the first five years and 30 days a year after — but its Employment Regulations 2024, in force since 1 April 2025, differ from the federal law in ways that matter:

The daily rate is the annual basic wage divided by 365, not monthly basic divided by 30
For the calculation, the basic wage cannot be treated as less than 50% of total wages
Gratuity is payable regardless of the reason for termination, including termination for cause
There is no two-year cap
Final amounts are due within 21 days, not 14

See ADGM end of service for the full picture and a worked example.

The same 10,000 AED basic, three regimes

Three years' service on a monthly basic of 10,000 AED. Federal law (mainland, JAFZA, DMCC): 63 days × 333.33 = 21,000 AED. ADGM: annual basic 120,000 ÷ 365 = 328.77 a day × 63 = 20,712 AED, assuming basic is at least half of total pay. DIFC (service entirely after February 2020): 36 monthly contributions of 5.83% × 10,000 = 20,988 AED paid in, plus or minus whatever the chosen fund has returned.

Nationals in free zones

UAE nationals are outside the Article 51 gratuity wherever they work and are covered by the pension legislation instead (Article 51(1)). DIFC and ADGM rules similarly take UAE and GCC nationals enrolled in the federal pension scheme out of their gratuity and savings arrangements. See UAE and GCC nationals.

How to check which regime you are in

Your contract. A DIFC or ADGM contract will refer to the DIFC Employment Law or the ADGM Employment Regulations. A federal one will refer to Federal Decree-Law No. 33 of 2021 and is usually on the MOHRE form.
Your work permit or employment card. It names the authority that issued it.
Your payslip. A DIFC employer contributing to DEWS will normally show it, and you will have your own DEWS account.

Questions

Does the UAE labour law apply in JAFZA and DMCC?

For end-of-service gratuity, yes. The federal decree-law applies to the private sector, including non-financial free zones, and the calculation is the same as on the mainland. Disputes usually start with the free zone authority rather than MOHRE.

I work in DIFC. Can I use this calculator?

No. DIFC replaced exit gratuity with monthly contributions to a qualifying scheme from 1 February 2020. Your entitlement for later service is what the scheme holds.

Is ADGM gratuity the same as mainland gratuity?

Similar in shape, different in detail: a 365-day daily rate, a minimum basic of half of pay for the calculation, no two-year cap, payable even on termination for cause, and a 21-day payment deadline.

Published 2026-10-18 and reviewed against Federal Decree-Law No. 33 of 2021, DIFC Employment Law No. 2 of 2019 as amended and the ADGM Employment Regulations 2024. General guidance, not legal advice — see the disclaimer.