How To Calculate End Of Service Or Gratuity For Jobs In Qatar

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End of Service EOS or gratuity is part of the Qatar Labour Law that stipulates a sum of money to be paid to an outgoing employee. The terms will be included in the employee’s contract. These contracts are normally terminated once their duration has passed OR prematurely under several conditions i.e. employee termination or resignation.

 

Apart from their salary, contract workers are awarded an ‘indemnity’ at the end of the contract period. The indemnity is calculated on the basis of basic salary (excluding bonuses). For those working in Qatar for a long time, indemnity can be a lot of money, as several people manage to accumulate considerable financial backup or live the high life. The indemnity is not related to insurance, but it is more of an end-of-the-term bonus, and is required by law to be paid to expatriate workers thanking them for serving the state. It is also known as ‘end-of-contract benefits’ or ‘end-of-service’ benefits. The indemnity scales are in the range 15 to 20 days of basic pay per year of employment for the first three years, and a month’s pay every year, thereafter.

A worker is entitled to an end of service gratuity, upon expiry of his service. The worker should have completed at least five years of employment. The gratuity will be agreed upon by the two parties, provided it is not less than three-week wages for each year of employment (and if one exceeds 5 years of service, gratuity could even be calculate at 30 days per year). The last drawn basic wage will be the base for calculation of gratuity. The employer is entitled to deduct from service gratuity, the amount due to him by the worker, if any.

Computation

Case 1: Worker served his employer for less than 5 years, the computation will be 3 weeks for every year the service rendered.

Formula: Basic Salary / 30 (the number of days in a month) x 21 days (three weeks) = Gratuity per year

Example: Basic wage of QAR 3,000/month and worked for 3 years

3,000 / 30 = 100

100 x 21 = 2,100

2,100 x 3 = QAR 6,300

Case 2: Worker served his employer for more than 5 years but less than 10 years, the computation will be 4 weeks for every year the service rendered:

Example: Basic wage of QAR 3,000/month and worked for 8 years

3,000 / 30 = 100

100 x 28 = 2,100

2,800 x 8 = QAR 22,400

Case 3: Worker served his employer for more than 10 years, the computation will be 5 weeks for every year the service rendered:

Example: Basic wage of QAR 3,000/month and worked for 15 years

3,000 / 30 = 100

100 x 35 = 3,500

3,500 x 15 = QAR 52,500

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