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

Under the Qatar Labour Law (Law No. 14 of 2004), an employer pays an end-of-service gratuity of at least three weeks' basic wage for each completed year of service, once the employee has finished one year. Fractions of a year beyond the first are paid pro rata.

What it is calculated on

The gratuity is based on the last basic wage. Allowances and bonuses are excluded, the same basis as the UAE. This is why the basic-to-allowance split in a Qatar package directly sets the gratuity an employer carries, and why a package weighted toward allowances lowers the accrued liability.

Three weeks is a floor, not a ceiling

Three weeks per year is the statutory minimum. A contract may set a higher rate, and many senior packages do, but it can never go below the minimum. When benchmarking an offer, read the gratuity rate in the contract rather than assuming the floor.

Resignation does not reduce it

Unlike Saudi Arabia, Qatar does not cut the gratuity when an employee resigns. The same per-year entitlement applies whether the employee leaves voluntarily or is terminated, provided the one-year threshold is met. That makes the Qatar liability simpler to forecast: years of service times the rate, with no resignation scale to model.

What this means for budgeting

Gratuity is an accruing liability that builds from the start of the second year. For a Qatar workforce, the forecast is clean: track completed service per employee against the contractual rate, recognise it as it accrues, and treat the basic-to-allowance split as the lever it is.