End-of-Service Gratuity Calculator

An End-of-Service Gratuity Calculator (also known as an EOSB Calculator, End-of-Service Benefits Calculator, or Gratuity Settlement Calculator) is a financial planning tool that calculates the severance pay owed to an employee upon termination, resignation, or contract expiry based on the applicable labor laws of the UAE or Saudi Arabia. It is an essential resource for HR professionals, employers, and employees who need to determine accurate gratuity amounts in compliance with federal and national labor regulations.

This end-of-service gratuity calculator accepts key inputs including the employee's country or jurisdiction (UAE or KSA), contract type (limited or unlimited), reason for end of service, monthly basic salary, and length of service — either entered as start and end dates or manually as years, months, and days. Advanced options allow users to factor in unpaid leave days and fixed allowances such as housing, transport, and other benefits. For instance, an employee in the UAE earning AED 10,000 per month with 7 years of service would receive a full gratuity calculated as 21 days' wage for the first 5 years plus 30 days' wage for the remaining 2 years. The calculator also generates a detailed accrual projection table and chart, showing how gratuity accumulates over the course of employment.

End-of-service gratuity is a legally mandated entitlement in both the UAE (under Federal Decree-Law No. 33 of 2021) and Saudi Arabia (under the Saudi Labour Law, Articles 84, 85, and 87). Miscalculating gratuity can lead to serious legal disputes, penalties from labor authorities, and damaged employee trust. For businesses operating across both jurisdictions, the differences in calculation methods — such as the UAE's 2-year salary cap, KSA's resignation reduction tiers, and special provisions for female employees — make manual calculations error-prone and time-consuming. An accurate gratuity calculator helps organizations budget for separation costs, maintain compliance during audits, and uphold fair treatment standards.

By automating end-of-service gratuity calculations, HR teams eliminate the risk of manual errors in applying complex, jurisdiction-specific formulas and reduction rules. The calculator provides instant, transparent breakdowns of how each result is derived — including daily wage computation, tier-based accrual, resignation reductions, and gratuity caps — empowering decision-makers with data-driven insights. This level of accuracy and transparency strengthens trust between employers and employees, supports financial planning and forecasting, and ensures that every separation is handled in full compliance with local labor laws.

Eligibility for end-of-service gratuity varies by jurisdiction. In the UAE, every employee who completes at least one year of continuous service qualifies for gratuity, regardless of whether they resign or are terminated — a change introduced by Federal Decree-Law No. 33 of 2021, which eliminated the resignation reduction rules under the old unlimited contract system. In Saudi Arabia, the rules are more nuanced: employees terminated by the employer or whose contracts expire become eligible after one year of service, while employees who resign voluntarily must complete at least two years before any gratuity entitlement accrues. Termination for gross misconduct under Article 80 of the KSA Labour Law results in complete forfeiture of gratuity rights, regardless of service duration.

End-of-Service Gratuity Formula:

The core question for employers and employees is: how much end-of-service gratuity is owed? The answer depends on the jurisdiction (UAE or KSA), the employee's basic salary, length of service, and the reason for separation. Below are the formulas used for each country.

1. Calculate Wage Basis

2. UAE Gratuity Calculation (Federal Decree-Law No. 33 of 2021)

Applies to all employees with 1 or more years of service. No resignation reductions under the 2022 law — all eligible employees receive full gratuity.

3. KSA Gratuity Calculation (Articles 84, 85, 87)

4. KSA Resignation Reductions (Article 85)

When a KSA employee resigns voluntarily, the gratuity entitlement is reduced based on total years of service:

Exceptions: Female employees who resign within 6 months of marriage or 3 months of childbirth receive full gratuity under Article 87. Force majeure events also entitle the employee to full gratuity regardless of service length.

5. Worked Example: UAE Gratuity Calculation

Consider an employee in the UAE earning a monthly basic salary of AED 15,000 who completes 8 years of service and is terminated by the employer:

6. Worked Example: KSA Gratuity Calculation

Consider an employee in Saudi Arabia earning SAR 8,000 basic salary plus SAR 2,000 housing allowance (actual wage = SAR 10,000) who resigns after 6 years of service with no special provisions:

1. Employee and Contract Details

• Country / Jurisdiction – Select between UAE and KSA, as each has distinct gratuity laws and calculation methods
• Contract Type – Choose limited (fixed-term) or unlimited (indefinite) contract; note that all UAE contracts are fixed-term under the 2022 Labour Law
• Reason for End of Service – The cause of separation (termination, resignation, contract expiry, or force majeure) directly affects gratuity entitlement and reductions
• KSA Special Provision – Accounts for exceptions under Article 87, such as female employees resigning after marriage or childbirth

2. Compensation Inputs

• Monthly Basic Salary – The base monthly salary used as the foundation for all gratuity calculations
• Currency – Select from 15 supported currencies for localized output display
• Housing, Transport, and Other Allowances – Optional fixed allowances included in KSA's "actual wage" calculation; UAE law uses basic salary only

3. Service Duration

• Joining Date and Last Working Date – Automatically calculates years, months, and days of service from employment dates
• Manual Entry (Years / Months / Days) – Alternative input mode for entering service duration directly
• Unpaid Leave Days – Days of unpaid leave are deducted from the total service period for an accurate net duration

4. Results and Projections

• Estimated Gratuity – The final gratuity amount after applying all reductions and caps
• Daily Wage – The calculated daily wage used in the UAE formula (basic salary divided by 30)
• Full Gratuity (Before Reduction) – The unreduced gratuity amount, shown when resignation reductions apply
• Reduction and Cap Details – Clear breakdown of any resignation reduction factors or UAE gratuity cap applied
• Accrual Projection Table and Chart – Visual projection of gratuity growth over years of service, helping employers forecast future liabilities

Understanding these components and the underlying formulas enables HR professionals and business leaders to accurately calculate end-of-service benefits, plan for financial obligations, and ensure every employee separation is handled transparently and in full compliance with UAE and KSA labor laws.

Employers and employees operating across the Gulf region must understand the distinct gratuity frameworks in each jurisdiction. The UAE and Saudi Arabia both mandate end-of-service gratuity payments, but the governing laws, calculation methods, eligibility rules, and reduction factors differ in critical ways. The table below provides a side-by-side comparison of the two systems.

The most significant differences lie in the wage basis and resignation treatment. UAE gratuity uses only the basic salary and applies no reductions for resignation under the current law, while KSA uses the full actual wage (including allowances) but applies tiered reductions for voluntary resignations. Organizations with employees in both countries must apply the correct jurisdiction-specific rules to each employee's calculation to avoid compliance errors and settlement disputes.

End-of-service gratuity is a statutory right in both the UAE and Saudi Arabia, but the eligibility rules differ based on jurisdiction, service length, and the circumstances of separation. Understanding these criteria is essential for both employers budgeting for liabilities and employees verifying their entitlements.

UAE Eligibility Rules

Under Federal Decree-Law No. 33 of 2021, every employee in the UAE who completes a minimum of one year of continuous service is entitled to end-of-service gratuity. This applies regardless of whether the employee resigns or is terminated — the 2022 law eliminated all resignation-based reductions that previously existed under the old unlimited contract system. All employment contracts in the UAE are now classified as fixed-term, and the gratuity entitlement is the same across all separation scenarios. Days of absence without pay are excluded from the service period calculation, and the employer must settle the gratuity within 14 days of the employee's last working day.

KSA Eligibility Rules

Saudi Arabia's eligibility rules are more layered. Employees terminated by the employer, whose contracts expire, or who leave due to force majeure qualify for gratuity after one year of service. Employees who resign voluntarily must complete at least two years of service before any gratuity accrues. Termination for gross misconduct under Article 80 of the Saudi Labour Law results in complete forfeiture of all gratuity rights, regardless of how long the employee has served. Female employees who resign within six months of marriage or within three months of childbirth receive full gratuity under Article 87, bypassing the standard resignation reduction tiers.

The salary basis for gratuity calculation differs between the two jurisdictions. In the UAE, only the basic salary is used — housing allowances, transportation allowances, bonuses, overtime pay, commissions, and other benefits are excluded from the calculation. In Saudi Arabia, the law uses the concept of "actual wage," which includes the basic salary plus all fixed allowances (housing, transport, and other regular payments). Variable or one-time payments such as overtime, commissions, and bonuses are excluded from the KSA calculation as well. This distinction makes a material difference: a KSA employee with a SAR 8,000 basic salary and SAR 4,000 in fixed allowances has a gratuity calculated on SAR 12,000 — not SAR 8,000.

An end-of-service gratuity calculator delivers measurable advantages for HR teams, finance departments, and employees navigating the complexities of severance calculations across the UAE and KSA. By replacing manual spreadsheet work with an automated, law-aligned tool, organizations reduce risk and improve the quality of every separation process.

• Regulatory Compliance – Automatically applies the correct formulas for UAE (Federal Decree-Law No. 33) and KSA (Articles 84, 85, 87), reducing the risk of legal disputes and penalties from labor authorities
• Transparent Compensation Projections – Provides employees with instant, itemized breakdowns of their gratuity entitlement, strengthening trust and reducing post-exit disputes over final settlements
• Automated Complex Calculations – Eliminates manual computation errors in applying tiered formulas, resignation reductions, and gratuity caps, saving HR teams an estimated 10-15 hours per month on administrative tasks
• Customizable Contract Scenarios – Supports multiple contract types, termination reasons, and special provisions (KSA female employee exceptions, force majeure), enabling HR to model different separation scenarios during planning
• Error-Prevention Safeguards – Built-in input validation prevents invalid salary amounts, negative service periods, and incorrect date ranges from producing inaccurate results
• Financial Forecasting – The gratuity accrual projection table and chart enable finance teams to forecast future gratuity liabilities across the workforce, supporting accurate budgeting and provisioning

Follow these steps to calculate your end-of-service gratuity entitlement:

1. Select Your Country

Choose between the United Arab Emirates (UAE) or Saudi Arabia (KSA). The calculator automatically adjusts the currency, available termination reasons, and applicable formulas based on your selection.

2. Enter Contract and Termination Details

Select the contract type (limited or unlimited) and the reason for end of service (termination, resignation, contract expiry, or force majeure). For KSA resignations, indicate whether any special provisions apply, such as a female employee resigning after marriage or childbirth.

3. Enter Your Monthly Basic Salary

Input the employee's monthly basic salary and select the desired currency. For KSA calculations, expand the Advanced Options to enter housing, transport, and other fixed allowances — these are included in the actual wage used for KSA gratuity.

4. Enter Service Duration

Choose between entering employment dates (joining and last working date) or manually entering years, months, and days of service. If the employee had unpaid leave, enter those days in Advanced Options to deduct them from the total service period.

5. Calculate and Review Results

Click "Calculate Gratuity" to generate the result. The calculator displays the estimated gratuity amount, daily wage, total service period, reduction details (if applicable), gratuity cap status (UAE), payment due date, and a full accrual projection table with chart showing gratuity growth over years of service.

In the UAE, Federal Decree-Law No. 33 of 2021 requires employers to settle all end-of-service gratuity payments within 14 days of the employee's last working day. Failure to meet this deadline exposes the employer to potential legal action and penalties from the Ministry of Human Resources and Emiratisation (MOHRE). Employers are permitted to deduct any outstanding amounts owed by the employee — such as loans or advances — from the gratuity payment, provided the deduction is documented and lawful.

In Saudi Arabia, the employer must include the gratuity in the final settlement paid upon contract termination. While the Saudi Labour Law does not specify an exact number of days for payment, gratuity forms part of the employee's final entitlements and must be settled promptly. Delayed payments can result in labor complaints filed through the Ministry of Human Resources and Social Development (HRSD). Gratuity rights are protected even in cases of employer insolvency — no court order can suspend or reduce an employee's gratuity entitlement.