End-of-service gratuity and workplace savings in Dubai

In Dubai there's no workplace pension and no state pension for expats, just a lump sum when you leave, so it pays to know exactly how that lump sum is worked out.

The short version

The FCDO is blunt: only UAE citizens can claim a UAE pension, but you may be eligible for end-of-service benefits if you've worked in the UAE [1].
Under the UAE labour law, private-sector employees with at least a year's continuous service get 21 days' basic wage for each of the first five years and 30 days' for each year after, capped at two years' wages [2].
It's worked out on your last basic wage, not your total package, and unpaid leave doesn't count [2][3].
Employers must pay end-of-service dues within 14 days of the contract ending [2].
In the DIFC, gratuity was replaced in February 2020 by DEWS, a funded savings plan with employer contributions of 5.83% or 8.33% of basic salary [4]. Elsewhere, employers can opt into a voluntary UAE savings scheme [5].

How the gratuity is worked out

The rules come from the UAE labour law, Federal Decree-Law No. 33 of 2021, and the UAE government portal restated them in October 2026 [2]:

You need a year. At least one year of continuous service, after which part-years count pro rata.
Years one to five: 21 days of basic wage for each year.
Year six onwards: 30 days of basic wage for each year.
The cap: the total can't be more than two years' wages, however long you've worked.
Basic wage only: it's calculated on your last basic wage. Housing, transport and other allowances are left out [2].
Unpaid leave doesn't count. Days of unpaid absence aren't included in the calculation [2][3].

Years of service	Gratuity, in days of basic wage	Roughly, in months of basic pay
Under 1	Nothing	Nothing
3	63	about 2.1
5	105	about 3.5
8	195	about 6.5
10	255	about 8.5

Days come from MOHRE's rule [2]; months assume a 30-day month and are only a guide.

A worked example

Take a Brit on a basic salary of AED 15,000 a month (about £3,030), with a total package nearer double that once housing and transport allowances are added. Leaving after eight years, the gratuity is 195 days of basic wage. If a day's wage is taken as a thirtieth of the monthly basic, that's about AED 97,500 (about £19,700). The cap of two years' wages, AED 360,000 (about £72,740), isn't close.

That's why the split between basic salary and allowances in your offer letter matters so much. Two packages with the same total can produce very different gratuities. Check the basic figure before you sign, and keep every contract and salary certificate.

Getting paid and the traps

The 14-day rule. End-of-service dues and any unpaid wages must be paid within 14 days of the contract ending [2].
Resigning doesn't cancel it. An employer can't withhold your gratuity simply because you resigned [6].
A cut basic salary reduces it. If your basic wage is validly reduced before you leave, the gratuity is worked out on the lower figure [6].
Get it in writing. Ask for a written breakdown of the final settlement, showing the basic wage and days used.

If your employer doesn't pay, MOHRE handles labour complaints for the mainland private sector. Free zones such as the DIFC run their own employment rules.

DEWS in the DIFC

Work in the Dubai International Financial Centre and your end-of-service money works differently. Since 1 February 2020, the DIFC Employee Workplace Savings plan (DEWS) has replaced the old gratuity scheme there [4]:

Employers pay in monthly: at least 5.83% of basic salary for employees with under five years' service, rising to 8.33% after five years [4].
You can add your own money, by regular salary deduction or one-off payments [4].
You choose the risk, including Sharia-compliant funds and cash options for anyone who doesn't want investment risk [4].
It's held by an independent master trustee, regulated by the Dubai Financial Services Authority, so the money is protected if your employer goes bust [4].

On a basic salary of AED 15,000 a month, the 5.83% contribution is about AED 875 (about £177) a month, and 8.33% is about AED 1,250 (about £252). The big difference from the old system is that the money is invested and set aside as you go, rather than being a promise paid out of the company's pocket on your last day.

The UAE's voluntary savings scheme

Outside the DIFC, the UAE has an alternative end-of-service savings scheme, run by MOHRE with funds approved by the Securities and Commodities Authority (SCA) [2][5]. It's voluntary, and only applies if your employer signs up:

Employers pay monthly contributions of 5.83% of basic salary for staff with under five years' service, or 8.33% after that, into SCA-approved funds [2].
You can top up by up to 25% of your total wage, by payroll deduction or a lump sum [2], and withdraw your own contributions at any time [5].
Funds come in conventional and Sharia-compliant versions, including a capital-guaranteed option [2].
When you leave, you're entitled to all the employer's contributions plus the returns. You can withdraw the money, leave it invested, or move it to a new employer's fund [5].

In your first week, ask HR which of the three you're on: the traditional gratuity, DEWS or the savings scheme. It changes how you plan.

Planning for retirement without a state pension

A gratuity is a leaving present, not a pension. Eight years' service on a decent salary might produce a sum that would barely buy a year of a modest retirement back home. Brits in Dubai have to build their own pot.

Your UK State Pension. It's still yours if you've paid enough National Insurance, but it's frozen in the UAE: the UAE isn't on the DWP's list of countries where it rises each year [7]. The full new State Pension is £241.30 a week in 2026/27 [8], and you'll be paid whatever the rate is when you first claim abroad. Years in Dubai can leave gaps in your record; our guide to voluntary National Insurance from abroad explains the 2026 changes.

UK workplace and private pensions. You can usually keep them and draw them later. Under the UK–UAE double taxation convention, pensions paid to a UAE resident are generally taxable only in the UAE, which taxes neither salaries nor pensions [9]. Be very wary of anyone urging you to transfer a UK pension into an overseas scheme. Transfers need regulated financial advice, can trigger the overseas transfer charge, and Brits abroad are a well-known target for pension scams. Our guide to UK pensions abroad and the transfer warnings explains the FCA and MoneyHelper warnings.

What sensible Brits do:

Treat the gratuity or DEWS balance as a bonus, not the plan.
Save a fixed share of the tax-free salary every month, starting in month one rather than year five.
Keep receipts and contracts for every job, so any gratuity dispute is quick.
Decide where you'll retire, because that sets the currency, the tax and whether your State Pension rises.

How people balance all this comes up a lot in our community group for Brits in the UAE.

Pound conversions use £1 = AED 4.9491, derived from the Bank of England USD spot rate of 5 November 2026 (£1 = USD 1.3476) and the dirham's fixed peg of AED 3.6725 per US dollar. Employment law and pensions are general information, not advice.

Sources

GOV.UK (FCDO): Living in the United Arab Emirates (updated 11 December 2025)
UAE Government portal: End of service benefits for workers in the private sector (updated 15 October 2026)
Arabian Business: Private-sector gratuity will not include unpaid leave days (MOHRE) (11 January 2023)
Dubai Media Office: DIFC unveils new employee workplace savings plan
Gulf News: The alternative end-of-service savings scheme (updated 16 February 2026)
Gulf News: UAE gratuity calculation guide
GOV.UK (DWP): Countries where we pay an annual increase in the State Pension
GOV.UK (DWP): Benefit and pension rates 2026 to 2027
GOV.UK (HMRC): 2016 UK–UAE Double Taxation Convention

End-of-service gratuity in Dubai: how it's worked out, DEWS and your retirement