JAFZA Gratuity Calculator – End of Service Rules 2026

Employees working in Jebel Ali Free Zone Authority (JAFZA) receive end-of-service gratuity as per the UAE Labour Law. This is a legal right that rewards employees for their years of service and provides financial security when they resign, retire, or complete a contract. It is a responsibility as well as a legal requirement for employers to calculate gratuity correctly.

Dubai Trade’s JAFZA gratuity calculator makes this process simple. You can estimate gratuity by just entering some basic details like salary, contract type, and service duration. In this guide, we will explain JAFZA gratuity rules 2026, eligibility, calculation methods, and how to use an online calculator. Also Read More Gratuity Calculator UAE 

The gratuity system in JAFZA is based on the UAE Labour Law (Article 139). Every JAFZA-registered company has to follow these rules.

Step 1: Minimum Service Requirement

• Employee must complete at least 1 year of continuous service.
• If the employee leaves the company within 1 year, then gratuity will not be available.

Step 2: Gratuity on Resignation

• If the employee resigns after 1 year, then gratuity is available.
• But the calculation depends on the type of contract (limited or unlimited).

Step 3: Gratuity on Termination

• If an employee is terminated for valid reasons (other than misconduct), they get gratuity.
• But if he is terminated due to serious misconduct (Article 44), he is not entitled to gratuity.

Step 4: Maximum Gratuity Cap

• The maximum limit of gratuity is up to 2 years of basic salary.

Step 5: In Case of Death

• If an employee dies, gratuity is transferred to their family.

Step 6: Deductions

• Employers cannot directly deduct a loan, advance, or debt from gratuity. This is settled through a different legal process.

In some situations, employees are not entitled to gratuity:

• Resignation before 1 year: If the employee resigns before completing 1 year, then he does not get gratuity.
• Termination for serious misconduct (Article 44): If the employee is terminated due to serious misconduct, then the gratuity is cancelled.
• Resignation under a limited contract: If the employee is on a limited contract and resigns before the completion of his contract, then he is not entitled to gratuity.

Gratuity calculation mainly depends on basic salary and service duration.

• Basic Salary: Only basic wage is counted (allowances like housing, transport, overtime are not included).

• Contract Type: A Limited or unlimited contract has different rules.

• Reason for Leaving: Calculation changes according to resignation, termination, or retirement.

• Years of Service: More service means more gratuity.

Standard Formula for Gratuity

The gratuity amount depends on years of service and basic salary.

Years of Service	Entitlement
1 to 5 years	21 days’ basic salary per year
More than 5 years	30 days’ basic salary per year
Maximum limit	Cannot exceed 2 years’ basic salary

Example:

• Basic Salary = AED 10,000
• Service = 7 years

Calculation:

• First 5 years → 21 days × 5 = 105 days salary
• Next 2 years → 30 days × 2 = 60 days salary
• Total = 165 days of salary = AED 55,000 approx.

Companies can use the Dubai Trade gratuity calculator to avoid errors.

Information Required:

• Contract type (limited/unlimited)
• Employment start and end date
• Basic monthly salary
• Reason for leaving (resignation, termination, retirement)

The calculator shows the estimated gratuity amount. Final approval is always from the JAFZA Labour Affairs Section.

Failure to follow JAFZA gratuity rules can lead to penalties and fines.

• Legal disputes can occur with employees.
• The company’s reputation is damaged.
• Correct calculation builds trust and avoids legal issues.

By calculating gratuity correctly, employers maintain trust, avoid legal problems, and show respect for their workforce.

• Employees should know their gratuity rights so that they are not underpaid.
• Understanding the rules allows them to make their financial plan.
• If gratuity is delayed or reduced, employees can demand their rights.

• Fast and error-free calculation
• Reduces disputes over settlements
• Ensures compliance with JAFZA and UAE Labour Law
• Strengthens trust in the workplace

JAFZA gratuity is an important financial benefit for employees and a legal duty for employers. Both parties can easily check their entitlement using the JAFZA gratuity calculator. Companies maintain compliance by following the right rules, and employees get the financial security they deserve after years of service.