End-of-service gratuity in Qatar: how it is calculated

When a contract ends in Qatar the question turns into a number very quickly: what is owed? The rule itself is short and plain, but arguments in practice are rarely about the rule — they are about what counts as the wage, how the months beyond the whole years are treated, and whether the gratuity is owed at all.

This guide sets out what Article 54 of Labour Law No. 14 of 2004 says and how it is applied, with the source given for each point.

Who is entitled

Gratuity is owed to any worker who has completed one year or more in the employer's service, whether the contract is fixed-term or open-ended, and whether it ended by resignation or by the employer. Completing the year is the only precondition; a worker who leaves before it earns nothing under this head.

• One full year or more with the same employer.
• The termination is not for one of the grounds set out in Article 61.
• It is calculated on the last basic wage, not on the gross package.

The formula

The amount is agreed between the parties, provided it is not less than three weeks' wage for each year of service. Three weeks is twenty-one days, which is the floor built into the government's own Hukoomi calculator.

Because wages are paid monthly and the law speaks in weeks, the monthly figure has to become a daily one. Practice divides the last basic monthly wage by thirty and multiplies by twenty-one days for each year of service. The statute does not fix the divisor, but this is the settled convention and the basis of the official calculators.

What counts as the basic wage

The base is the last basic wage before service ended, stripped of allowances: housing, food, transport, commission and overtime all sit outside it unless the contract says otherwise. This is where most disagreements start — the worker reads what lands in the bank, the employer reads the basic line in the contract.

Since Law No. 17 of 2020 the basic wage has a statutory floor, which means the gratuity has one too:

The basic figure is the same in all three rows: QAR 1,000. Any gratuity for service ending after the law took effect that is calculated on a lower basic wage is calculated below the statutory minimum.

Part years

A worker is entitled to gratuity for a part year in proportion to the time served. Months beyond the whole years are neither dropped nor rounded up: six months is half a year's gratuity, three months a quarter. The first year itself still has to be completed.

When it is forfeited

Gratuity is lost where service ends for one of the grounds set out in Article 61 — the serious-misconduct cases, listed exhaustively, with no discretion for the employer beyond what the statute names. Outside those cases the reason for the ending does not affect entitlement: resignation counts the same as dismissal.

Continuous service

Service is treated as continuous where it ended other than under Article 61 and the worker returned within two months. This matters in practice: rehiring somebody after a short break does not reset their seniority, and gratuity is calculated across the whole period rather than on the latest contract.

Three weeks is a floor, not a ceiling

The law sets a minimum, not a maximum. Plenty of contracts in the Qatari market give a full month's pay per year, and some increase the rate with length of service. Whatever the contract promises applies, as long as it is above the statutory figure. And where the employer runs a pension or savings scheme that leaves the worker better off, the worker may choose between the two.

Before you pay out

1. 1Fix the start date and the actual last working day — not the date the residence permit was cancelled.
2. 2Take the last basic wage from the contract or the final payroll run, stripped of allowances.
3. 3Check the contract's own gratuity clause: if it is better than three weeks, it governs.
4. 4Count the whole years, then the remaining months in proportion.
5. 5Give the worker a written statement showing the period, the wage used and the arithmetic.