End-of-service gratuity calculator — 6 MENA countries, official formulas

How much end-of-service gratuity (مكافأة نهاية الخدمة) do you owe an employee in UAE, Saudi, Egypt, Qatar, Kuwait, or Iraq? Formulas differ per country and tenure bracket. This guide covers the exact labor-law formula for each country with worked examples. AttendUX automates all six calculations in payroll — this page is the reference.

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Per-country end-of-service formulas

Built around how MENA teams actually manage this day-to-day.

UAE (Federal Law 33/2021)

21 days basic salary per year for first 5 years + 30 days per year after. Max cap 2 years basic salary. Based on LAST basic salary excluding allowances. Limited vs unlimited contract adjustments (resignation deductions removed under 2022 reform).

Saudi Arabia (Labor Law)

Half-month salary per year for first 5 years + full month per year after 5 years. Based on LAST wage (basic + housing + regular allowances). Resignation after full term: 100%. Resignation 2-5 yrs: 33%. Resignation 5-10 yrs: 66%. Resignation 10+ yrs: 100%.

Egypt (Labor Law 14/2025)

Half-month wage per year for first 5 years + full-month wage per year thereafter — payable on contract termination not initiated by employee misconduct. Based on last wage. Partial-year prorated.

Qatar (Law 14/2004)

3 weeks salary per year of service for first 5 years + larger entitlement after (typically 1 month/yr) — minimum rate; employers often pay more. Based on last basic salary. Payable on contract end regardless of termination reason.

Kuwait (Law 6/2010)

15 days per year for first 5 years + 1 full month per year after. Based on last salary. Specific resignation reduction formulas under 3/5/10 year brackets per Article 51.

Iraq (Law 37/2015)

Half-month salary per year of service — payable on termination unless gross misconduct. Based on last wage. Additional Article-provisions for specific termination types. Full week per year of service in some sectors.

Worked examples — how EoS gets calculated

UAE

UAE example — 7 years, AED 10,000 basic

21 days × 5 yrs = 105 days (for first 5). Plus 30 days × 2 yrs = 60 days (for years 6-7). Total 165 days. Daily rate = 10,000 ÷ 30 = AED 333.33. Gratuity = 165 × 333.33 = AED 55,000. Under 2-year cap (2 × 12 × 10,000 = 240,000). Final: AED 55,000.

KSA

Saudi example — 8 years, SAR 12,000 wage

Half-month × 5 yrs = 2.5 months (for first 5). Plus 1 month × 3 yrs = 3 months (years 6-8). Total 5.5 months. Gratuity = 5.5 × 12,000 = SAR 66,000. If terminated by employer: full. If employee-resignation 8 yrs: 66% = SAR 43,560.

EGY

Egypt example — 6 years, EGP 8,000 wage

Half-month × 5 yrs = 2.5 months. Plus 1 month × 1 yr = 1 month. Total 3.5 months. Gratuity = 3.5 × 8,000 = EGP 28,000. Payable if termination not for employee gross misconduct.

QAT

Qatar example — 4 years, QAR 10,000 basic

3 weeks × 4 yrs = 12 weeks = 2.77 months. Gratuity = 2.77 × 10,000 = ~QAR 27,700. Minimum per Law 14/2004 — employers often pay more generous rates. After 5 yrs: higher entitlement kicks in.

KWT

Kuwait example — 10 years, KWD 1,500 salary

15 days × 5 yrs = 75 days. Plus 1 month × 5 yrs = 5 months. Total 75 days + 5 months = ~7.5 months. Gratuity = 7.5 × 1,500 = KWD 11,250. Reduction if resignation; full if termination by employer.

Key rules shared across MENA (and where they differ)

Base wage: UAE = basic salary only (no allowances); Saudi = basic + housing + regular allowances (broader base); Egypt/Qatar/Kuwait/Iraq = last total wage. Different base = different amounts for same tenure.
Resignation vs termination: UAE 2022 reform removed resignation reductions. Saudi still applies brackets (33/66/100% depending on years). Kuwait Article 51 reductions. Egypt 14/2025 pays regardless unless gross misconduct.
Partial year: All 6 countries prorate — 6 months of service = half-year of accrual. Daily calculation used for accuracy.
Maximum cap: UAE caps at 2 years basic salary. Others no formal cap but generous tenures produce large sums.
GOSI/PIFSS/GRSIA overlap: Saudi GOSI, Kuwait PIFSS, Qatar GRSIA pay separately to nationals. Expats rely on EoS only.
Fixed-term vs unlimited contracts: UAE post-2022 unified under limited contracts. Historical unlimited-contract employees have transition clauses.

How AttendUX automates this in payroll

Per employee: labor-law country selected, tenure calculated from hire date, formula applied automatically
At termination: EoS computed + shown in exit settlement, approved by HR, auto-added to final payslip
Running liability tracked: group CFO sees total unpaid EoS liability across all employees (balance-sheet number)
Labor-law updates: when UAE/Saudi/Egypt labor law changes (e.g., Egypt 14/2025 revisions), AttendUX payroll engine auto-updates — no manual reconfiguration
Audit trail: every EoS payment logged with the exact formula + inputs + resolution, immutable for labor inspection or legal dispute
Mid-month termination proration: fixed per memory `project_payroll_mid_hire_proration` — monthly payslip accounts for pre-hire / post-termination calendar days

Frequently Asked Questions

What is end-of-service gratuity and who is entitled to it?

End-of-service gratuity (مكافأة نهاية الخدمة) is a legally mandated lump-sum payment owed to private-sector employees in MENA countries upon contract termination. It's separate from any social-insurance pension (GOSI, PIFSS, GRSIA, NOSI). Expats typically rely on it entirely since they don't qualify for most MENA social-insurance programs. Egyptian, Saudi, UAE, Qatari, Kuwaiti, and Iraqi labor laws all mandate it with per-country formulas.

What's the exact UAE end-of-service formula?

Per Federal Law 33/2021: 21 days of basic salary per year for the first 5 years of service, plus 30 days of basic salary per year for every year after the 5th. Maximum cap: 2 years of basic salary. Uses LAST basic salary excluding allowances (housing, transport, etc.). Resignation reductions were removed under the 2022 reform — resigning employee and terminated employee get the same calculation.

How does Saudi end-of-service differ from UAE?

Saudi uses a broader wage base (basic + housing + regular allowances, not just basic). Formula: half-month wage per year for first 5 years, full-month wage per year after. Critically, resignation reduces the gratuity based on tenure: resign 2-5 yrs = 33% of full, 5-10 yrs = 66%, 10+ yrs = 100% (contract completion = always 100%). This is distinct from UAE's post-2022 no-reduction rule.

Does AttendUX calculate end-of-service for every MENA country automatically?

Yes. All 6 country formulas are pre-configured (UAE 33/2021, Saudi Labor Law, Egyptian 14/2025, Qatar 14/2004, Kuwait 6/2010, Iraq 37/2015). Per employee, the correct formula applies based on their assigned country. At termination, EoS auto-computes + appears in exit settlement + flows to final payslip. Running liability (unpaid EoS accruing) tracked for CFO balance-sheet reporting.

What happens if an employee transfers between group entities in different MENA countries?

Each entity tracks service separately per its country's law. Egypt → UAE transfer: Egyptian entity calculates EoS per 14/2025 and pays out when employment there ends; UAE entity starts fresh service clock per Federal Law 33/2021. No cross-country EoS accumulation. This is consistent with how MENA group HR typically handles this + how most labor laws interpret it.