Does resigning change your gratuity?

What the law says

The law gives gratuity to “the foreign full-time Worker, who has completed one or more years of continuous service … upon the end of his service” (Federal Decree-Law No. 33 of 2021, Article 51(2)).

It doesn’t say how the service has to end, and Article 51 has no reduced rate for people who resign. Resign or be let go, the sum is the same: 21 days’ basic wage for each of your first five years and 30 days for each year after that.

Why older advice says otherwise

You may read that resigning cuts your gratuity. That advice usually comes from the previous labour law, Federal Law No. 8 of 1980. The 2021 law repealed it (Article 73(1)).

There is one exception. For unlimited (indefinite-term) contracts made under the old law, Article 68(3) says “the Employer may calculate the end-of-service gratuity in accordance with the provisions of the indefinite-term employment contract” in that law. So if your job started before 2 February 2022 on an unlimited contract, your employer may be allowed to use the old rules. We haven’t read the old law yet, so we can’t say how that would change your amount. Ask your employer which rules they’re using.

Leaving because of your employer

The government’s official guidance says that in the cases set out in Article 45, where your employer is in breach, you may leave without notice and still “retain their end-of-service entitlements”.

If you’re dismissed arbitrarily, the same guidance says you can claim your gratuity on top of any compensation (Article 47).

Dismissed for misconduct

Article 44 lists the cases in which an employer can dismiss a worker without notice, such as serious misconduct. It says nothing about gratuity, and nothing else in the law takes gratuity away because you were dismissed.

The law’s list of disciplinary penalties even includes “Dismissal from service while preserving the Worker’s right to end-of-service gratuity” (Article 39(1)(g)). Your employer can still deduct amounts you lawfully owe (Article 51(7)).

Your notice period

Notice counts as service. The law says the contract “shall remain effective for the duration of the warning period” and ends when that period runs out (Article 43(2)). So use the date your contract ends as your last day of employment.

When you get paid

However your job ends, your employer must pay “within fourteen (14) days as of the date of the end of the contract, his wages and all other entitlements” (Article 53). See what goes into a final settlement.