The five buckets of money you're owed
When employment ends in the UAE private sector, an employee can be owed money from up to five separate legal buckets. Missing any one of these is a common employer error and a common employee grievance:
- End-of-service gratuity — Article 51.
- Notice period pay or pay-in-lieu — Article 43.
- Cash for unused annual leave — Article 29(9).
- Any unpaid wages, overtime, or allowances earned before the end.
- Arbitrary-dismissal compensation — Article 47, only when the termination retaliates against a lawful complaint or lawsuit by the worker (up to three months' gross wage).
1. End-of-service gratuity (Article 51)
The gratuity formula under Federal Decree-Law 33/2021:
- 21 days of basic pay for each of the first five years of service.
- 30 days of basic pay for each additional year beyond five.
- Total is capped at two years of basic wage.
- Only basic salary is used — housing, transport, and other allowances are excluded.
- Fractions of a year after the first year are pro-rated.
No gratuity is owed for service under one year, and none is owed if the termination falls under Article 44 (misconduct-for-cause). See the full EOSB guide or use the free calculator.
2. Notice period or pay-in-lieu (Article 43)
Article 43 sets a notice range of 30 to 90 days (contractual; the default in most templates is 30 days). Either party can substitute payment in lieu — the leaving party (or the employer, if the worker is asked to leave immediately) pays a compensation equal to the wage for the un-served notice period. See the notice period guide for the mechanics, including garden leave and how notice interacts with the other buckets.
3. Unused annual leave, cashed out (Article 29(9))
Any annual leave the employee earned but did not take must be paid in cash at the end of the relationship, calculated on the basic wage. If the employer insisted on leave being taken during the notice period, that generally does not replace the cash-out entitlement for leave earned before notice.
4. Unpaid wages, overtime and allowances
Anything earned but unpaid by the last day is due. This includes overtime (Article 19), sales commissions, and contractual allowances. Complaints about missing wages should be raised with MOHRE quickly — under the Wage Protection System the ministry can freeze new work permits for employers with unpaid salaries.
5. Arbitrary-dismissal compensation (Article 47)
This is the least-understood entitlement. It applies only when the employer terminated the worker as retaliation — for filing a valid complaint or winning a lawsuit against them. The labor court may award up to three months' gross wage (basic + allowances), on top of gratuity and notice pay. This is not a general "unfair dismissal" — the retaliation link must be proven. Poor performance dismissals do not qualify.
The 14-day payment deadline (Article 53)
The employer has 14 days from the end of the relationship to pay everything owed. Late payment can trigger MOHRE penalties and interest under the general labor-law procedural rules.
How to actually collect if the employer stalls
- Send a written demand listing every bucket with the calculation.
- File a MOHRE complaint (free) within one year of the end date.
- If mediation fails, MOHRE refers the case to the labor court. Claims up to AED 100,000 are fee-exempt for the worker.
- Keep all pay slips, WPS confirmations, and the termination letter — they are the evidence base.