FinalSettlementUAE end of service, calculated correctly

Terminated after eight years on a 25,000 AED package

A longer-service case where the 30-day band applies, the package split does most of the damage, and a separate Article 47 claim may sit alongside the gratuity.

The facts

Step 1 — service period

15 January 2018 to 15 March 2026 is 2,981 days, or 8.167 years. Nothing to deduct.

Step 2 — which basic wage

The final basic wage, 10,000 AED, applies to the entire period — including the years when it was 6,500. Promotions work in your favour here, and the calculation is not done year by year.

10,000 ÷ 30 = 333.33 AED per day

Step 3 — both bands

Over five years, so the entitlement splits:

That is 6.67 months of basic wage — but only 2.67 months of the 25,000 package.

What the package split costs

Basic is 40% of this package. Had the same 25,000 been structured with a 15,000 basic, the gratuity would be 100,000 AED rather than 66,667 — a difference of 33,333 AED on identical work and identical total pay. Nothing can be done about it at the end. It is a negotiation at the offer stage, and almost nobody treats it as one.

The rest of the settlement

ItemAmountBasis
End-of-service gratuity66,667200 days at basic wage
Untaken annual leaveby days accruedPaid at basic wage, 333.33 per day
Notice—Worked, so nothing due in lieu
Repatriation expensesstatutoryArticle 13(12) obligation on the employer, unless he joins another employer or the reason for termination is attributable to him
Article 47 compensationup to 3 months' last wageCourt-awarded, and only where the termination was unlawful under Article 47 — not for any dismissal thought unfair

Article 47 compensation is a separate question

Gratuity is payable whether or not a termination was justified — it is earned by service, not conditional on good behaviour.

Article 47 is narrower than the phrase “arbitrary dismissal” suggests, and the gap between the two is where most disappointment happens. A termination is unlawful under Article 47(1) where it resulted from the worker filing a serious complaint with MOHRE, or bringing a lawsuit against the employer whose validity is proven. That is a retaliation provision. A dismissal that feels unjust, or that was handled badly, or that you think was commercially unreasonable, does not come within it on those facts alone. Where it is established, Article 47(2) lets the court set fair compensation — weighing the type of work, the damage done and the length of service — capped at three months of last wage. Article 47(3) then confirms that this compensation does not displace your notice allowance or your gratuity: it sits on top of them.

An employer occasionally presents the two as a trade: accept a reduced gratuity and no dispute. They are legally distinct, and a reduced gratuity is not a concession the employer has the right to offer.

What about the two-year cap?

Not reached here. The ceiling is 24 months of wage, which at this basic is 240,000 AED — equivalent to 720 days of entitlement, or around 25 years and 6 months of service. At 200 days this case is well inside it.

Run your own version

The calculator handles both bands automatically and flags the cap if your service reaches it.

Figures are for the case described and reviewed 2026-09-27. General guidance, not legal advice — see the disclaimer.