JAFZA Gratuity Calculator 2025

Established in 1985 and managed by DP World, the Jebel Ali Free Zone (JAFZA) was one of the first free economic zones in the Middle East. Due to its strategic location near Jebel Ali Port and Al Maktoum International Airport, it plays a critical role in Dubai’s trade infrastructure, hosting over 9,000 companies, including several Fortune 500 firms.

JAFZA offers a business-friendly environment designed to attract multinational operations, e-commerce firms, and logistics giants. Companies registered here benefit from customs-free trading, full foreign ownership, and zero income tax, making it a magnet for international investors and employers.

JAFZA’s Regulatory Environment

JAFZA operates under its own Free Zone Authority, not the federal labor ministry. This body manages everything from company licensing to employment regulations. While it often follows the structure of UAE Federal Labor Law No. 33 of 2021, it’s not bound by it. JAFZA has the legal freedom to create its own rules on hiring, firing, and end-of-service benefits.

How JAFZA Labor Regulations Works

In the mainland UAE, labor is regulated directly by the Ministry of Human Resources and Emiratisation (MOHRE). But free zones like JAFZA operate semi-independently. For example:

JAFZA Gratuity Rules

End-of-service gratuity isn’t a bonus, it’s a legal right. In JAFZA, this right is granted under a blend of UAE Federal Labor Law and JAFZA-specific employment policies. But to receive gratuity, certain rules apply, from how long you’ve worked to the reason your job ended.

Let’s break these down one by one.

Eligibility Criteria

Gratuity is available to most full-time employees in JAFZA who have completed at least one full year of continuous service. You also need to be under a valid employment contract registered with the JAFZA authorities. If your contract has expired or you’re working without legal status, gratuity rights may be challenged.

Minimum Service Requirement

To qualify, the minimum required service period is one year. If you resign or are terminated before completing a full year, you’re not entitled to any gratuity, regardless of your salary or job performance.

Maximum Gratuity Limit

Under JAFZA policy, the maximum gratuity an employee can receive is two years’ worth of basic salary, regardless of how long they’ve worked. This cap exists to prevent abuse and to standardize settlements across companies operating in the zone.

Gratuity on Resignation

One thing you have to keep in mind all the time when you are calculating your gratuity is that when you resign before five years, your gratuity is calculated at 21 days’ basic pay for each year of service. But when you resign after completing five years or more on your job, you receive 30 days’ basic pay per year as gratuity.

This rule aligns with Article 51 of the UAE Labor Law but is enforced within JAFZA through their internal contract registry.

Gratuity on Termination

According to the guidelines of UAE labor law, if an employee is terminated for reasons other than gross misconduct, he should get his gratuity entitlement as someone who resigns

However, if the employee is found guilty of cases like proven fraud, violence, or policy violations, the employer has the legal right to withhold the gratuity amount.

Death or Disability

If an employee dies during service, the gratuity is paid in full, regardless of service length, and transferred to the legal heirs or next of kin.

If the employee becomes permanently disabled due to work-related reasons, they’re also entitled to full gratuity, plus potential compensation depending on medical assessments. These cases are handled with the assistance of JAFZA’s legal department and, if needed, Dubai Courts.

Gratuity Deductions

Employers can legally deduct from gratuity only in specific situations:

Such deductions must be documented and approved. Random or blanket deductions are not allowed under UAE labor regulations or JAFZA policy.

How to Calculate Gratuity in JAFZA

Gratuity in JAFZA is calculated using a formula based on your basic salary and total service period. The calculation mirrors UAE mainland rules in structure but applies within JAFZA’s jurisdiction. This section unpacks the formula, shows how it works, and provides real-life examples for clarity.

Formula Used for Gratuity

The basic gratuity formula in JAFZA follows this pattern:

1. For the first 5 years of service:
   21 days of basic salary × number of years worked
2. After 5 years of service:
   30 days of basic salary × number of years worked beyond 5 years

Important notes:

• The final amount cannot exceed two years’ basic salary.
• Only basic salary is used (not allowances, bonuses, or commissions).

This is in accordance with UAE Federal Law No. 33 of 2021, which JAFZA implements unless otherwise stated in company-specific contracts.

Example

Suppose an employee resigns after 3 Years

The final Gratuity will be:
21 days × 200 × 3 = AED 12,600

JAFZA Gratuity Calculator – Free Online Tool

Understanding your end-of-service benefits shouldn’t feel like decoding tax law. The JAFZA Gratuity Calculator simplifies the process into a few easy steps, giving workers clear, fast answers based on UAE regulations and JAFZA-specific rules.

How It Works

To get an accurate estimate of your gratuity payout, users simply enter:

Note: If you are a domestic worker in UAE, you can use our UAE domestic worker gratuity calculator.

Why Use an Online JAFZA Gratuity Calculator?

If you’ve ever tried to decode your end-of-service pay using a spreadsheet or vague HR policy documents, you know how frustrating it can be. Our JAFZA gratuity calculator saves you from that confusion by giving clear, reliable estimates grounded in law.

Reduces Human Error

Manual calculations often overlook small but crucial factors, such as partial years, exclusions like housing allowance, or legal caps. A calculator based on up-to-date rules removes the guesswork and applies formulas consistently.

Helps in Negotiation with HR

Many employees accept whatever number the HR department offers — often because they don’t have a basis for comparison. With an accurate estimate in hand, you can ask the right questions and challenge underpaid settlements if needed.

Useful for Final Settlement

Leaving the UAE involves paperwork, deadline pressure, and financial stress. Knowing your gratuity amount upfront gives you leverage when reviewing your final settlement papers and ensures that nothing is missing before you sign off.

Legal Rights & Support

Even in a well-regulated zone like JAFZA, gratuity disputes do happen. Some employers delay payments. Others try to reduce the amount or claim vague deductions. Here’s what you should know if your end-of-service dues are delayed, denied, or disputed.

What If the Employer Refuses Your Gratuity

If your employer refuses to pay your gratuity — or pays less than expected — you have every right to challenge the decision. Here’s how to start:

1. Request a written explanation from your HR department. This creates a paper trail.
2. Contact JAFZA’s HR Department, which operates under DP World. They often mediate disputes directly before escalation.
3. File a formal complaint with MOHRE (if applicable). While JAFZA is a free zone, federal protections under UAE Labour Law No. 33 of 2021 still apply in many employment matters.

Keep copies of your:

Tips to Maximize Your Gratuity

FAQs

Final Thoughts

Many expats working in JAFZA aren’t told how gratuity actually works—until it’s too late. And when a job ends, things move fast: final settlements, visa cancellations, and exit plans. That’s when mistakes happen. But if you know your rights in advance, you’re in control.

Gratuity isn’t a favor—it’s your legal entitlement. And in a zone like JAFZA, where rules follow UAE law but enforcement sits with the Free Zone Authority, you need to be even clearer on what applies and what doesn’t.