UAE Gratuity Example: 8 Years of Service, Mixing the 21-Day and 30-Day Tiers

October 23, 2026

Past 5 years of service, UAE gratuity stops being a single multiplication — the first 5 years are paid at 21 days per year, and every year after that at 30 days per year. Here's a full 8-year example.

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The Numbers

Monthly basic salary: AED 10,000. Daily basic wage: 10,000 ÷ 30 = AED 333.33.

  • Years 1-5 (21-day rate): 5 × 21 × 333.33 = AED 35,000
  • Years 6-8, three years (30-day rate): 3 × 30 × 333.33 = AED 30,000
  • Total gratuity: AED 35,000 + AED 30,000 = AED 65,000

The Mistake to Avoid

A common error is applying 30 days to all 8 years (giving a wrong total of AED 80,000) or applying 21 days to all 8 years (giving a wrong total of AED 56,000). Only the years beyond the fifth get the higher 30-day rate — the first five are always at 21 days, no matter how long the total tenure eventually is.

Frequently Asked Questions

At what point does the 30-day rate start applying?

Starting with the sixth year of service — the first five years are always calculated at 21 days per year.

What is the total gratuity for 8 years at AED 10,000 basic?

AED 65,000 — AED 35,000 for the first 5 years plus AED 30,000 for the remaining 3 years at the higher rate.

Is the 30-day rate applied to all years once you pass 5 years?

No — only to the years after the fifth. The first 5 years keep their original 21-day valuation.

Does the cap affect this example?

No — AED 65,000 is well below the cap of two years' wage (AED 240,000 at this salary).