How to Claim Your End-of-Service Benefits if You are Outside the UAE

We have previously shared how you can calculate your gratuity pay or end-of-service benefits in the UAE. But what if you lost your job while you were outside the country? Amid the ongoing global crisis and travel restrictions, is it still possible to claim your gratuity pay? And if so, how?

Article 132 of the UAE Labour Law states that “the worker, having spent one year or more in continuous service, shall be entitled to an end-of-service gratuity upon the termination of his service.” Read more about this benefit and how you can claim it, even if you are outside the UAE.

claim gratuity pay outside uae

Guide to Claiming Gratuity Pay from Outside the UAE

First of all, let us take a quick look into how gratuity pay is calculated — depending on the type of contract — before discussing how to claim it if you are outside the country.

You may recall that a limited contract is a “fixed term” contract, wherein an employee agrees to work with an employer for a specific period of time. If the employee decides to resign before the specified “end date,” he/she may face a labour ban, or in some cases, may even be asked to pay compensation to the employer.

An unlimited contract, on the other hand, is one that does not include a specific period and has no specified “end date.” In this case, the employee is required to give a one-month to three-months’ notice before resigning or terminating his/her contract.

Either way, it’s important for you to know how gratuity pay is calculated, to avoid any problems or misunderstandings with your employer when your contract ends.

A. How to Calculate Gratuity Pay

1. For Limited Contracts

Under a limited contract, an employee who has spent one or more years in continuous service is entitled to gratuity pay upon the end of his service, which will be calculated as follows:

  • If the employee has served for less than one year, he/she is not entitled to any gratuity pay.
  • If the employee has served for more than one year but less than five years, he/she is entitled to full gratuity pay based on 21 days’ salary for each year of service.
  • If the employee has served for more than five years, he/she is entitled to full gratuity pay based on 30 days’ salary for each year of work succeeding the first five years.
  • In all of these cases, the total gratuity pay shall not exceed the salary of two years.

2. For Unlimited Contracts

Under an unlimited contract, the end-of-service pay will be calculated as follows:

  • If the employee has served for less than one year, he/she is not entitled to any gratuity pay.
  • If the employee has served for more than one year but less than five years, he/she is entitled to 21 days’ basic salary for each year of service.
  • If the employee has served for more than five years, he/she is entitled to 30 days’ basic salary for each year of work succeeding the first five years, provided that the total amount does not exceed the salary of two years.

Meanwhile, if an employee decides to resign, the gratuity pay will be calculated as follows:

  • If the employee resigns before completing one year of service, he/she is not entitled to gratuity pay.
  • If the employee has served between one and three years, he/she is entitled to one-third of 21 day’s basic salary as end-of-service pay.
  • If the employee has served between three and five years, he/she is entitled to two-thirds of 21 day’s basic salary as end-of-service pay.
  • If the employee has served for more than five years, he/she is entitled to a full 21 days’ basic salary as end-of-service pay.

B. Can Deductions be Made from Gratuity Pay?

Yes. Article 135 of the UAE Labour Law states that if a worker owes money to his/her employer, the amount may be deducted from the said worker’s end-of-service pay.

C. Reasons Why One May NOT Receive Gratuity Pay

According to Article 139 of the UAE Labour Law, a worker may not receive gratuity pay if he/she: (a) is dismissed from service for any of the reasons set forth in Article 120 (e.g. adopting a false identity, forging of documents, etc.); and (b) leaves the job of his/her own accord and without notice.

D. How to Claim Gratuity Pay from Outside the UAE

Amid the ongoing crisis, you may have lost your job due to business reasons (e.g. the company had to close operations or reduce its number of workers). If you were outside the UAE when the crisis hit — and are unable to return because of travel restrictions — this could be another factor that may have led to the discontinuation of your contract.

Whatever the reason, if you and your employer have agreed to terminate the contract, and you have served continuously for more than a year — you are entitled to receive gratuity pay, even if you are outside the country. How can you do this? By making a written request for your employer to transfer your end-of-service pay to a bank outside the UAE. Your request should include your bank account details as well as the final settlement amount.

While you are requesting for your gratuity pay to be transferred to a bank outside the UAE, you should also be making arrangements for your bank inside the country to be closed. This is to avoid any problems related to “dormant” accounts. In the UAE, a bank account is considered dormant if it has had no customer-initiated activity — such as payments, withdrawals, and electronic transactions — for at least one year.

DISCLAIMER: The above guide is presented for information-sharing purposes only. To learn more about gratuity pay or end-of-service benefits, please visit the UAE Government Portal

As you can see, claiming your end-of-service benefits is possible even if you are outside the UAE, as long as you communicate clearly with your employer and comply with the necessary letters or documents. Meanwhile, if you are currently employed and thinking about resigning, please read more about the things to know before resigning from your job in the UAE.


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