The latest articles on DEV Community by Aurang Zeb Loona (@loonaautomation). https://dev.to/loonaautomation https://media2.dev.to/dynamic/image/width=90,height=90,fit=cover,gravity=auto,format=auto/https:%2F%2Fdev-to-uploads.s3.us-east-2.amazonaws.com%2Fuploads%2Fuser%2Fprofile_image%2F4222771%2F219d4b1b-1929-4c02-9e24-86bdada59c8d.jpg https://dev.to/loonaautomation en Aurang Zeb Loona Mon, 02 Nov 2026 16:41:05 +0000 https://dev.to/loonaautomation/uae-gratuity-explained-for-builders-the-2022-rule-change-most-calculators-still-get-wrong-4ak4 https://dev.to/loonaautomation/uae-gratuity-explained-for-builders-the-2022-rule-change-most-calculators-still-get-wrong-4ak4 <p>I build free, privacy-first web tools as Loona Automation. The newest one is a set of salary and tax calculators, and the first calculator I built — UAE end-of-service gratuity — taught me something surprising: a large share of the gratuity calculators on the web still apply a law that was abolished in 2022.</p> <h2> The current law (Federal Decree-Law 33/2021, Article 51) </h2> <p>For a full-time foreign private-sector employee with at least 1 year of continuous service:</p> <ul> <li>Daily basic wage = last monthly basic salary ÷ 30. Basic only — housing, transport and allowances do NOT count.</li> <li>First 5 years: 21 days of basic wage per year.</li> <li>Every year after the 5th: 30 days of basic wage per year.</li> <li>Part-years are pro-rated.</li> <li>Total gratuity is capped at 2 years' wage.</li> <li>The employer must pay within 14 days of the contract ending (Article 53).</li> </ul> <p>Formula: Gratuity = (Basic/30 × 21 × min(years,5)) + (Basic/30 × 30 × max(years−5,0)), capped at 24 × monthly basic.</p> <p>Worked example: basic salary AED 10,000, 7 years of service → (10,000/30 × 21 × 5) + (10,000/30 × 30 × 2) = 35,000 + 20,000 = AED 55,000.</p> <h2> What changed in February 2022 </h2> <p>Before Decree-Law 33/2021 took effect on 2 February 2022, the UAE had limited and unlimited contracts, and resigning under an unlimited contract cut your gratuity (to 1/3 or 2/3 depending on service). That system is gone. Today all private-sector contracts are fixed-term, and resignation does NOT reduce gratuity. If a calculator asks you to pick "limited vs unlimited" or docks your gratuity for resigning, it is calculating with the old law. (Two honest exceptions: DIFC and ADGM have their own employment schemes, and some employers use the voluntary alternative savings scheme instead of gratuity.)</p> <h2> Why I built it client-side </h2> <p>Salary data is sensitive. The calculator runs 100% in the browser — no server, no sign-up, nothing leaves the device. The whole thing is a static site: one HTML file per tool with the formula in plain JavaScript, tested against hand-computed cases from the law text (my test suite checks the example above and the 2-year cap, among others).</p> <p>Try it: <a href="https://loonaautomation.github.io/loona-salary-calculators/uae-gratuity-calculator/" rel="noopener noreferrer">https://loonaautomation.github.io/loona-salary-calculators/uae-gratuity-calculator/</a><br> Code and the other calculators (Saudi end-of-service, Netherlands net salary with the 30% ruling, Germany gross-to-net, Pakistan salary tax): <a href="https://github.com/loonaautomation/loona-salary-calculators" rel="noopener noreferrer">https://github.com/loonaautomation/loona-salary-calculators</a></p> <p>If you spot a formula edge case I have missed — especially around unpaid-leave exclusions — I would genuinely like to hear it. Accuracy is the whole point of the tool.</p> webdev javascript tutorial career