Leaving at exactly five years on a 9,000 AED basic
Five years is the most misunderstood date in UAE gratuity. It is not a second threshold and nothing doubles on the anniversary. What changes is the rate at which every later day is earned — and that is easier to see with three dates side by side.
The facts
- Accountant, Dubai mainland, private company under the federal law
- Started 1 March 2021; employment ended 1 March 2026 after a worked notice period
- Basic wage 9,000 AED at the end of the employment; total package 15,000
- No unpaid leave; annual leave fully used
Step 1 — the service period
1 March 2021 to 1 March 2026 is exactly five years by date. The calculator on this site counts whole years from anniversary to anniversary, so this comes out at 5.000 years, not 5.003 — the leap day in February 2024 does not add a sliver.
Step 2 — the daily basic wage
9,000 ÷ 30 = 300 AED per day. The 6,000 of allowances in the package play no part; Article 51(2) calculates the benefit "according to the basic wage", and Article 51(5) uses the last basic wage the worker was entitled to.
Step 3 — the entitlement
All five years fall in the first band, at 21 days each:
- 5 × 21 = 105 days
- 105 × 300 = 31,500 AED — 3.5 months of basic wage
Nothing in the second band has been earned yet. The 30-day rate in Article 51(2)(b) applies to "each year exceeding" the first five, and on these dates there is no time beyond the fifth anniversary.
The same job, three leaving dates
| Employment ends | Service | Days earned | Gratuity |
|---|---|---|---|
| 1 December 2025 | 4.753 years | 99.82 | 29,947 |
| 1 March 2026 | 5.000 years | 105.00 | 31,500 |
| 1 September 2026 | 5.504 years | 120.12 | 36,037 |
The working, so it can be checked:
- 1 December 2025: four whole years, plus 275 days of a 365-day year = 4.753. 4.7534 × 21 = 99.822 days × 300 = 29,947 AED.
- 1 September 2026: five whole years, plus 184 days of a 365-day year = 5.504. First five years 105 days; the remaining 0.5041 × 30 = 15.123 days; 120.123 × 300 = 36,037 AED.
The three months before the anniversary were worth about 1,553 AED. The six months after it were worth about 4,537 AED — roughly 756 AED a month against 518 a month before. That is the whole of the five-year effect: each month after the fifth anniversary earns 2.5 days of basic wage instead of 1.75. There is no lump that lands on the day itself.
Why people expect a jump
Two pieces of outdated guidance feed the idea that five years is a cliff.
- The repealed resignation scale. Under Federal Law No. 8 of 1980, an employee on an unlimited contract who resigned with between three and five years' service received only two thirds of the gratuity, and the full amount only from five years. So at the old law, resigning a week before the fifth anniversary really did cost a third. That scale went with the 1980 law on 2 February 2022. Resignation no longer reduces your gratuity sets out what replaced it.
- Reading "30 days a year" as applying to all years. It does not. A person with six years' service earns 21 days for each of the first five and 30 days for the sixth — 135 days in total, not 180. Any figure that multiplies the whole service by 30 once you pass five years is overstating, and an employer will reject it.
The rest of the settlement
| Item | Amount | Basis |
|---|---|---|
| End-of-service gratuity | 31,500 | 105 days at 300 AED, Article 51 |
| Final salary | 15,000 | Full package for February |
| Untaken annual leave | — | None outstanding on these facts |
| Notice pay | — | Notice worked |
| Repatriation expenses | check | Article 13(12), subject to its two exceptions |
Payable within 14 days of 1 March 2026 (Article 53).
Where this case could be disputed
- The end date. If the employer records the last day as 28 February rather than 1 March, service is a day short of five years and the figure drops by a few dirhams, not by thousands. It is worth getting right, but it is not the cliff it is sometimes presented as.
- Unpaid leave. Any unpaid days come off the end of the service period, so they reduce the most recent time first. Past five years, that is time earning 30 days a year. See the unpaid leave scenario for the effect in numbers.
- The basic wage. As always, the single biggest lever. At a 6,000 AED basic the same five years pays 21,000; at 12,000 it pays 42,000. See what counts as basic salary.
Questions
Should I wait until after my fifth anniversary to resign?
For gratuity alone, the anniversary is not a trigger: the months before it and after it are both paid pro rata, and resignation no longer reduces anything. Staying longer earns more, and after five years it earns at a higher monthly rate, but there is no bonus that lands on the date itself.
Is the 30-day rate applied to all my years once I pass five?
No. Article 51(2) applies 21 days to each of the first five years and 30 days only to each year beyond them. The two bands are added together.
Related
- How gratuity is calculatedThe two bands and the arithmetic, step by step
- Terminated after eight yearsA case well into the second band
- Run your own figureEnter your dates and basic wage in the calculator
Figures are for the case described. Published 2026-10-18 and reviewed against Federal Decree-Law No. 33 of 2021. General guidance, not legal advice — see the disclaimer.