How to Calculate Jafza Gratuity in 2025: Dubai Free Zone Rules, Law & Calculator

What is Jafza?

Jafza (Jebel Ali Free Zone) is one of the UAE’s most established and influential free zones, located in Dubai. Since its launch in 1985, Jafza has grown into a major economic hub, home to over 9,500 global companies. It’s operated by DP World and serves as a key gateway for international trade, logistics, and manufacturing across the region.

If you're employed under a Jafza visa, your employment is managed by the Jafza Authority—which follows the UAE Labour Law but also applies its own zone-specific policies. This includes how contracts are structured, how disputes are resolved, and how end-of-service benefits like gratuity are calculated.

Whether you're working in logistics, tech, retail, or any other sector in Jafza, it's important to understand how your gratuity is handled under these free zone rules

What is Gratuity in Jafza?

Gratuity is a one-time end-of-service payment given to employees who complete at least one year of continuous service. It's a legal right—not a bonus—and applies when an employee resigns or is terminated, provided certain conditions are met.
In Jafza, gratuity is based on the UAE Labour Law (Federal Decree Law No. 33 of 2021), which outlines the general rules. However, the Jafza Authority may apply additional guidelines, such as when and how payments are settled, or how early resignation affects the final amount.

Key Points:

• Gratuity is calculated on the last basic salary (not including allowances).
• You must complete at least one full year of service to be eligible.
• The amount depends on your contract type (limited or unlimited), length of service, and whether you resigned or were terminated.
• Employers in Jafza are generally required to settle gratuity within 14 days after the employee’s final working day.

Why It Matters:

Gratuity in Jafza isn’t just a legal obligation—it's part of your financial security when leaving a job. Knowing how it’s calculated can help you:

• Plan your resignation or job switch wisely.
• Understand what you’re entitled to if your contract ends.
• Avoid disputes and delays when collecting your dues.

Who Is Eligible for Jafza Gratuity?

Not every employee automatically qualifies for gratuity in Jafza. Eligibility depends on several factors such as your contract type, duration of service, and reason for leaving. Understanding these rules can help you know what to expect at the end of your employment.

You’re eligible for gratuity in Jafza if:

• You’ve completed at least 1 year of continuous service.
• You were employed under a valid limited-term contract (mandatory since 2022).
• You weren’t dismissed for gross misconduct (as defined in Article 44 of the UAE Labour Law).

You may lose gratuity if:

• You resign before completing 1 year.
• You're dismissed due to serious violations (e.g. fraud, theft).
• You leave without serving notice (in limited contracts).
• You're terminated lawfully during your probation period.

Special Cases in Free Zones (like Jafza)

Jafza operates under UAE Labour Law, but as a free zone, some companies may add additional clauses to employment contracts. These clauses:

• Must not contradict the UAE Labour Law.
• May enhance gratuity beyond the legal minimum (if agreed in writing).
• Could specify different notice periods or leave policies, but gratuity formulas typically remain consistent.

Pro Tip: Even if you work in Jafza, your gratuity rights are protected by the Federal Decree Law No. 33 of 2021. Always refer to your signed employment contract and discuss with HR before resigning or exiting your job.

Does Jafza Gratuity Apply to All Employees?

Yes, Jafza gratuity applies to:

• Office-based professionals (admin, HR, finance)
• Engineers, IT staff, logistics and warehousing teams
• Healthcare and service workers
• Employees of contractors/subcontractors under Jafza license Regardless of nationality or job role, if your contract meets eligibility rules, gratuity applies.

How to Calculate Jafza Gratuity in 2025 (With Formula + Example)

Calculating your end-of-service gratuity in Jafza involves a standard formula based on UAE labour laws. While the rules are clear, it's important to understand what factors are included — and what’s not.

Gratuity Calculation Formula in Jafza

Gratuity is based on your basic monthly salary, not the total salary (so it excludes housing, transport, and other allowances).

Here’s the formula used:

Gratuity = (Basic Salary ÷ 30) × Number of Eligible Days × Years of Service
The number of eligible days is usually:

• 21 days per year of service (for employees with up to 5 years)
• 30 days per year (after 5 years of service)

Example Calculation

Let’s say your details are:

• Basic Salary = AED 10,000
• Years of Service = 6 years
• Contract Type = Limited (as per new rules)

First 5 Years:

• (10,000 ÷ 30) × 21 × 5 = AED 35,000

6th Year:

• (10,000 ÷ 30) × 30 × 1 = AED 10,00

Total Gratuity = AED 35,000 + AED 10,000 = AED 45,000

"Looking to calculate your Jafza gratuity in 2025? While our website provides a general UAE gratuity calculator, you can also use the official Dubai Trade End-of-Service Calculator to estimate your payout based on your Jafza employment details."

Gratuity Rules for Resignation vs Termination in Jafza

The amount of gratuity you receive in Jafza depends not only on your years of service, but also on how your employment ends—whether you resign or are terminated. Below is a breakdown of gratuity entitlements under each situation:

Gratuity on Resignation in Jafza

If you voluntarily resign after completing at least 1 year of continuous service, you are entitled to a gratuity payout based on your length of service. However, certain conditions apply:

• Resignation during probation: No gratuity is paid.
• Resignation without notice: May lead to deductions or forfeiture of gratuity.
• Early resignation from limited-term contract: May reduce or cancel gratuity (if contract not completed).

Gratuity on Termination in Jafza

If your employer terminates your contract (and the reason is not due to gross misconduct), you’re generally entitled to full gratuity based on your years of service, even if you didn’t complete the full contract term.

Key Points:

• Gratuity applies after 1 year of service.
• If termination is unjustified, you may be entitled to compensation in addition to gratuity.
• Termination due to misconduct may cancel gratuity.

Tip: The gratuity payout is higher when an employee is terminated versus when they resign early.

Example:

You get terminated after 6 years with a basic salary of AED 10,000

• First 5 years: (10,000 ÷ 30) × 21 × 5 = AED 35,000
• 6th year: (10,000 ÷ 30) × 30 = AED 10,000
• Total = 35,000 + 10,000 = AED 45,000

Things to Keep in Mind

• No gratuity is paid if the service is less than 1 year.
• Employees must complete their contract or follow proper resignation/termination terms to receive gratuity.
• Gratuity is capped at two years’ worth of basic salary maximum (as per UAE law)

Jafza Visa Gratuity Rules & Free Zone Employment Implications

Working under a Jafza visa or within a free zone company like Jebel Ali Free Zone (Jafza) means your employment is governed by a combination of UAE Labour Law and Jafza-specific regulations. While the core gratuity entitlements remain like the mainland, there are some distinctions worth noting.

Are Jafza Employees Entitled to Gratuity?

Yes. All employees working in Jafza are entitled to end-of-service gratuity as per Federal Decree Law No. 33 of 2021, provided they’ve completed at least 1 year of continuous service.

Gratuity applies regardless of:

• Nationality
• Job title
• Jafza sponsorship or third-party employment
• Whether you're under a limited contract (as required in 2025)

What If You're on a Jafza Visa but Work for Another Company?

If you're sponsored by a Jafza-licensed entity but seconded elsewhere:

• Your gratuity is still calculated under Jafza rules unless contractually stated otherwise.
• It’s essential that your employment contract clearly defines the applicable jurisdiction and gratuity terms.

Free Zone vs Mainland Gratuity

Tip: Free zone companies, including Jafza, may issue internal employee handbooks that include additional policies on gratuity, probation, or notice periods. Always read your employment contract and annexes carefully.

Jafza Gratuity and Visa Cancellation / Final Settlement Process

When your employment in Jafza comes to an end—either through resignation, termination, or contract expiry—your visa cancellation and final settlement process is directly linked to your gratuity payout. Understanding this flow ensures you avoid unnecessary delays or deductions.

What Happens at the End of Employment?

Once your employment officially ends, your company is required to:

1. Cancel your employment visa (within the Jafza portal / UAE GDRFA system).
2. Process your final salary and end-of-service entitlements, including:

• Remaining salary
• Unused annual leave balance (encashed)
• Gratuity amount
• Airfare (if applicable in contract)

3. Provide a service certificate (if requested).
4. Update labour card and residence permit status.

How Long Does Gratuity Processing Take?

• Employers are typically required to settle dues within 14 days from the last working day.
• Some companies in Jafza may do it faster, especially if you’ve completed your clearance steps.

Link with Visa Cancellation

• Your labour card and residency visa must be cancelled before the final gratuity amount is released.
• You may not be allowed to switch jobs or exit the country until this process is completed.

Common Mistakes That Affect Gratuity in Jafza

Even with clear UAE labour laws in place, many employees unintentionally miss out on their full gratuity amount due to simple mistakes. Here are some of the most common pitfalls to avoid when working in Jafza:

• Resigning Without Proper Notice: Walking away without completing the notice period (usually 30 days) may result in forfeiture or deductions from your gratuity payout.
• Confusing Allowances With Basic Salary: Gratuity is calculated only on your basic salary, not your full pay package. Assuming housing, transport, or bonuses count can lead to overestimating your dues.
• Leaving During Probation or Before One Year: Employees who leave during probation or before completing one full year of continuous service are not eligible for gratuity under UAE law.
• Not Completing Clearance Procedures: In Jafza, your visa cancellation, company clearance, and final payroll processing are all tied together. Delaying or skipping these steps can postpone or complicate your gratuity payout.
• Misunderstanding Contract Terms: Not reading your limited-term contract carefully—or assuming it’s the same as a mainland contract—can create confusion. Free zone policies often have internal clauses, especially regarding resignation or early exits.

Taking a few extra steps to clarify your status before leaving can prevent last-minute surprises and ensure you receive what you’re entitled to.

What to Ask HR Before Leaving Jafza

Before submitting your resignation or completing your exit formalities, it’s smart to clarify a few key points with your company’s HR team. These questions can help you avoid delays and make sure your gratuity and final settlement are accurate:

• Can you provide a breakdown of my gratuity calculation?
• What is the official last working day recorded in the system?
• Will my unused annual leave be encashed in the final payout?
• When will my end-of-service payment be processed?
• How long will visa cancellation take, and can I track it?
• Are there any deductions (loans, notice shortfall, penalties)?
• Can I request a service or experience certificate?

Asking these in advance ensures transparency, helps you plan your next steps (such as new employment or travel), and protects your rights as an employee in Jafza.

Note:

• Some Jafza companies don’t follow MOHRE rules directly, so internal HR policies may add exceptions.
• Always check your contract, as some employers insert clauses that influence how your gratuity is calculated.

FAQS

Final Takeaway

If you’ve worked in Jafza, your gratuity might be processed slightly differently compared to a mainland company, but the base formula and entitlements are still governed by the 2021 UAE Labour Law. Make sure to verify with your HR and request a detailed final settlement showing gratuity calculation and other dues.