The Calculation Of Gratuities

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The Calculation of Gratuities Mar 01, 2007
Hi

I'm finally in the process of negociating my contract. It is for Senior Management position within an international consultancy. There calculating the gratuity on the standard UAE 21 days per year for the first five years. This seems a little mean considering the seniority of the position.

Do most companies stick to this rule, or does it vary and if so how.

Also they've offered me 30 days holiday and bank holidays. What's the standard number of bank holidays in Dubai.

Many thanks and I promise I wont bombard you with to many questions.

MERLOT
Dubai Forum User
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Location: Manchester

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Mar 01, 2007
What do you mean by gratuity? Bonus?

30 days holiday is good, there's about 10 public holidays I think.
scot1870
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Mar 01, 2007
It's called Terminal Gratuity and is paided in accordance with the UAE Labour Law following a minimum of one years service.

Hope that makes it clearer
MERLOT
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Mar 01, 2007
It's called Terminal Gratuity and is paided in accordance with the UAE Labour Law following a minimum of one years service.

Hope that makes it clearer
MERLOT
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Mar 01, 2007
OK, got you. This is UAE law and is standard. It builds up over time and is effectively free money when you leave, don't complain. I worked 6 years in the UK and got nothing when I left, it's all relative.
scot1870
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Mar 01, 2007
Sounds a bit mean to me. Isn't it standard to get one month's salary for each year you work?
sauron
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Mar 01, 2007
From my HR dept, I believe it's as per UAE Labour Law standard:

Code: Select all
Gratuity in an unlimited contract is as under:-

a) An employee who resigns after continuous service of more than one year & not more than three years is entitled to one third of the of the end of service gratuity, that means you will get 7 days for each year.

b) If the period of service is more than three years and less than five years he is entitled to two thirds of the gratuity

c) If his continuous service is more than five years, he is entitled to the full gratuity (21 days)

The above is calculated on basic salary.


Cr@p! When signing, I didn't know about it and careless about my monthly salary break ups (I negotiated only total/all-in take home pay). On the agreement, they put "basic salary" only 70% and the rests are allowances. Therefore my gratuity would only be 70%. :( If I knew it earliear, I could have negotiated better (no break up on the salary).
xty
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Mar 01, 2007
xty wrote:From my HR dept, I believe it's as per UAE Labour Law standard:

Code: Select all
Gratuity in an unlimited contract is as under:-

a) An employee who resigns after continuous service of more than one year & not more than three years is entitled to one third of the of the end of service gratuity, that means you will get 7 days for each year.

b) If the period of service is more than three years and less than five years he is entitled to two thirds of the gratuity

c) If his continuous service is more than five years, he is entitled to the full gratuity (21 days)

The above is calculated on basic salary.


Cr@p! When signing, I didn't know about it and careless about my monthly salary break ups (I negotiated only total/all-in take home pay). On the agreement, they put "basic salary" only 70% and the rests are allowances. Therefore my gratuity would only be 70%. :( If I knew it earliear, I could have negotiated better (no break up on the salary).


hurray! Your HR Manager or whoever brain your HR policy is smart. :D Company saves 30% from paying gratuity. Most companies are doing the same. :wink:
asc_26
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Mar 01, 2007
asc_26 wrote:hurray! Your HR Manager or whoever brain your HR policy is smart. :D Company saves 30% from paying gratuity. Most companies are doing the same. :wink:

Well, in the end, that's fine... it's free money anyway. Most of companies I worked with (different countries) don't give this. But lesson learned ;)
xty
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Re: The Calculation of Gratuities Mar 02, 2007
MERLOT wrote:Hi

I'm finally in the process of negociating my contract. It is for Senior Management position within an international consultancy. There calculating the gratuity on the standard UAE 21 days per year for the first five years. This seems a little mean considering the seniority of the position.

Do most companies stick to this rule, or does it vary and if so how.

Also they've offered me 30 days holiday and bank holidays. What's the standard number of bank holidays in Dubai.

Many thanks and I promise I wont bombard you with to many questions.


It is 21days foe each of the first 5years and as already mentioned it is subject to deduction if you resign. Most companies pay according to the law, because they have to.

Bank holidays will be Private sector holidays which vary slightly but you should count an average of 8
sage & onion
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