As per the UAE Pension Law, the end-of-service gratuity in this case is calculated as follows:

§  An average contribution salary of 1.5 (one and a half) months for the first five years of the insured's service period

§  A two-month average contribution salary for the second five years of the insured’s service period

§  A three-month average contribution salary for years exceeding ten years of the insured’s service period

Please note that an insured individual’s average contribution salary is calculated as follows:

§  Government sector: Average contribution calculation salary for the last three (3) years of service

§  Private sector: Average contribution calculation salary for the last five (5) years of service

Hypothetical example:
Fatima, an insured individual, has worked for 11 years in a government authority. The contribution salary for calculating her pension was Dh20,000 in the last three years of her service.

How is Fatima's end-of-service gratuity calculated?

1.5 x 20,000 x 5 = Dh150,000
2 x 20,000 x 5 = Dh200,000
3 x 20,000 x 1 = Dh60,000

Total compensation payable = Dh410,000