Gratuity Calculator Dubai Claimed

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Debate in any corner of the modern world about employment, labor laws, and business is incomplete without considering the UAE. Being the latest hub of business activities, Dubai opened its doors of opportunities to local and foreign communities. UAE labor gratuity calculator Dubai assists in estimating the gratuity amount according to the employee’s salary.

The firm legislation of Dubai is significant in fair manpower management. Policies are developed to help the employees in acquiring a fine amount of money. This financial subsidy is awarded to those employees who provide their services for the betterment of the organization.

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Importance Gratuity Calculator in UAE

Gratuity is generally considered at the End of Service in UAE. Foreign workers in Dubai are not eligible to be rewarded with a pension but a good amount of EOSB is set aside for them. UAE Federal Labor Law states that each worker is eligible to be rewarded with gratuity payment if they qualify the criteria at the end of their service tenure.

In UAE Companies utilizes the labor Gratuity Calculator to calculate the amount of money to be given as a salary element. Businesses setups generally hand over such jobs to their finance team and acquire the services of legal consultants to calculate the plan according to UAE law. An employer becomes eligible for gratuity, once he completed one year of service.

Factors affecting Gratuity in UAE

Gratuity is dependent upon two factors, one of them is the type of contract, and the secondary is the reason behind leaving the organization. UAE offers 2 types of contracts to every organization:

1.     Limited Contract 

The worker can sign an agreement for a specific time whereas the company and the employees are permitted to cancel or extend the contract.

2.     Unlimited Contract

In his type of contract, workers are not bound to work for a particular period but both parties can reach a point of consensus to sign a contract permitting the worker to work as long as he desires.

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Calculating gratuity in Dubai

Gratuity is totally dependent upon the type of contract between the employee and employer. Various clauses are signed according to the type of contract so it definitely put a significant impact on salary and gratuity calculations. Below we have shared the process for both types of contracts:

Gratuity calculation in Limited Contract

  • Calculating per day salary
  • Multiplication of salary with years of service that is 21 or 30
  • Results will present the annual gratuity
  • Multiplication of annual gratuity with years of service
  • The final result is the amount of gratuity to be provided to employees for limited contracts

The number of years an employee served in an organization affects the limited contract gratuity calculation. If an employee has worked for more than 1 year in any company then 21 days’ wage will be considered for gratuity calculation in Dubai. For those who work for more than 5 years, 30 days’ salary will be considered for each year.

Gratuity calculation for Unlimited Contract

  • Calculating per day salary
  • Multiplication of salary with years of service that is 21 or 30
  • Results will present the annual gratuity
  • Count ⅓ or ⅔ of the annual gratuity according to the tenure of service
  • Multiplying annual gratuity with years of service

The final result is the amount of gratuity to be provided to employees for unlimited contracts

In the case of an unlimited contract number of years an employee served will have a great impact on the gratuity. For those who served from 1-3 years, ⅓ of the 21 days wage is applicable. When it comes to the employees serving for working more than 3 and less than 5 years is ⅔ of 21 days wage.

Those employees who have unlimited contracts and keep working in a firm for more than 5 years will be eligible to acquire gratuity according to salary consideration for 30 days. Firms might face legal accusations if they wrongly computed gratuity.

Eligibility Criteria for Gratuity-UAE

Authorities in UAE have set the policies for the calculation of gratuity. If a person fails to have compliance with the rules and regulations set by the authorities of UAE, he might lose the chance for acquiring the service gratuity.

Below we have mentioned some pro tips for you to save yourself from such subjects by:

  • Avoid leaving the company before the time span mentioned in the limited contract. Gratuity cannot be offered until an employee accomplish more than 5 years in any firm.
  • Avoid leaving the company without prior notice.
  • Submission of fake documents as original might end up in losing gratuity loss
  • Avoid damaging the company assets
  • Fulfill your duties with dedication during your service at the company

Gratuity calculation for employees who resign or receive termination by the firm is different. 30 days wage will be applicable for employees who were terminated with zero complaints in their service. However, terms might get changed for those who put resignations. There is the possibility that a worker would not get gratuity for leaving the firm before completion of tenure.

Rules Set for Gratuity Calculator Dubai

Labor contracts in UAE will play role in calculating the gratuity amounts by fair means. There must not be any injurious measures for unlimited contract gratuity limited contract gratuity calculation. Terms and conditions on a calculation of gratuity in Dubai as per the laws will be answered below using the subsequent points

  • A worker who served less than one year is not eligible for gratuity.
  • Expats serving in UAE can apply for gratuity only not the pension.
  • As per UAE Labor LawArticle 132, gratuity will not be offered for more than 2 years of wage
  • As per Article 34 of UAE Labor Law, a basic salary should be the basis for gratuity calculations. Extra allowance like food, medical, etc will not be added.
  • UAE Labor Law- Article 135 addresses that if a worker takes a loan from the firm then an employer has the permission to deduct the loan amount from gratuity

The amount of Gratuity is different depending upon the

  1. License type
  2.  Reason for leaving the firm
  3. Years of serving
  4. Registration with Gratuity Calculator UAE

Our registered companies with Gratuity Calculator UAE have been working on the calculation on the basis of set rules and regulations by UAE authorities. Our associate law firm has the best Advocates in UAE and is offering the best services to its client across UAE. Our associate law firm has expertise in dealing the numerous legal issues.

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