In the constantly changing realm of employment, it is crucial for expatriates working in Qatar to have a clear understanding of their rights and entitlements. Among the various benefits and protections offered to employees, end-of-service gratuity is a significant component. This financial benefit, often referred to as “Gratuity in Qatar,” serves as a financial safety net, ensuring that employees are rewarded for their service when they decide to part ways with their employer.
Calculating your gratuity can be a complex task, as it involves various factors and variables. In this article, we will explore the steps and considerations involved in computing your gratuity. Understanding how to compute gratuity in Qatar is not only a legal requirement but also a vital aspect of financial planning for expatriates.
What is End of Service Gratuity?
Employers in Qatar give their employees End of Service Gratuity (ESG) as a reward for their work. It is like a financial way to thank employees for their service. When employees finish a certain amount of time on the job or leave, they are entitled to get ESG as a form of financial security for their time spent working.
The amount of ESG is usually based on the length of service and the employee’s basic salary as per Qatari labour law. ESG is a legal requirement in Qatar, and employers are obligated to provide it to eligible employees as per the labour regulations.
Eligibility for End of Service Gratuity (ESG)
Employees in Qatar are entitled to receive gratuity payments at the end of their service. Whether they resign or receive a termination letter, they become eligible for gratuity pay. According to Article 54 of the labour law, any employee who has completed more than one year of continuous service is eligible for gratuity.
Laws related to End of Service Gratuity
According to Labour Law (Article 54 of Law No. 14 of 2004):
“In addition to any sums to which the worker is entitled upon the expiry of his service, the employer shall pay the end-of-service gratuity to the worker who has completed employment for one year or more. This gratuity shall be agreed upon by the two parties, provided that it is not less than a three-week wage for every year of employment. The worker shall be entitled to gratuity for fractions of the year in proportion to the duration of employment.”
According to Article 15 of Law No. 15 of 2017 on Domestic Workers:
“In addition to any amounts due to the worker at the end of their term of service, the employer shall pay an end-of-service gratuity to the worker who has been employed for one full year or more as of the effective date of this law. The gratuity shall be determined and agreed upon by both parties, provided it is not less than three weeks’ pay for each year of service. The worker is further entitled to get a gratuity for fractions of the year based on the entire duration of service proportionately. The employer shall be entitled to deduct the amounts the worker owes to the employee from the gratuity.”
How do I calculate the End of Service Gratuity (ESG)?
You can easily calculate the end-of-service gratuity by using the online gratuity calculator that the Ministry of Administrative Development, Labour, and Social Affairs (MADLSA) provides. This ministry offers a convenient online service for employees and applicants to figure out their gratuity on its official website. However, please note that this gratuity calculator page is available only in Arabic.
To calculate your End of Service Gratuity on the ministry’s website, follow these steps:
- Visit the website: Go to the official website of the Ministry of Administrative Development, Labour, and Social Affairs.
- Enter Joining Date: Look for the ESG calculator tool and enter your joining date, which is the day when you started working.
- Provide Last Working Date: Enter the date when you stopped working for your employer; that is your last working day.
- Input Your Monthly Salary: Provide your basic monthly salary, which is the amount you earn before any extra allowances or bonuses.
- Enter Gratuity Days: The calculator will ask you to enter the number of gratuity days for each year you have worked. These days are based on your years of service.
- Get Your ESG Calculation: After entering all the details, the calculator will process the information and show you the calculated end-of-service gratuity amount. This represents what you are entitled to receive based on your work history and Qatar’s labour laws.
Basic rules related to the calculation of End of Service Gratuity
- The basic amount used for gratuity calculation is the last monthly salary received.
- Changes in employment type do not affect the gratuity amount that an employee is entitled to.
- Unpaid leave is not counted towards the total service duration. It reduces the gratuity if an employee has unpaid leave days.
- If the employer provides a pension plan, the employee may not be eligible for an end-of-service gratuity.
- Gratuity is calculated based on 21 days of pay for each year of service.
- Employers can deduct any outstanding amounts from an employee’s gratuity.
Is it possible for the employer to retain the gratuity payments?
In Qatar, employees have a legal right to receive gratuity payments. This payment serves as a financial safety net for those who have worked a certain period for their employer. The law in Qatar states that employers must provide gratuity under specific circumstances. This includes when an employee resigns or when their employment contract concludes. However, there are times when employers might try to withhold or delay these payments.
According to Article 61 of the Labour Law, an employer has the right to instantly terminate an employee’s contract without prior notice or the obligation to pay the end-of-service gratuity (ESG) under specific circumstances of severe misconduct.
Examples of such misconduct include:
- assuming a false identity or nationality,
- providing false documents,
- causing substantial financial harm to the employer,
- revealing confidential information,
- and being discovered intoxicated or under the influence of drugs during working hours.
An employee must be aware that any effort by an employer to withhold gratuity payments against labour laws can result in legal consequences. Employees hold the right to seek legal action to ensure they receive their rightful gratuity payment. Labour laws exist to safeguard employees’ rights, and employers are generally obligated to adhere to these laws concerning gratuity payments.
What happens to the gratuity if the worker passes away?
As per the Labour Law (Article 55 of Law No. 14 of 2004), if the worker dies during employment for whatsoever causes, the employer shall, within a period not exceeding fifteen days from the date of death, deposit with the court any wages or entitlements due to the worker in addition to the gratuity. The depositing record shall contain a detailed report indicating the method of calculating the sums referred to, and a copy of the record shall be delivered to the department.
The court shall distribute the deposited sums amongst the heirs of the deceased worker in accordance with the provisions of the Islamic Sharia or the personal law applicable in the country of the deceased.
If three years have lapsed since the date of the deposit without the person entitled to the deposited sums being known, the court shall transfer the said sums to the public fund of the state.
Conclusion
In conclusion, understanding how to calculate end-of-service gratuity in Qatar is crucial for both employers and employees. This financial benefit serves as a significant component of an employee’s compensation package, and knowing how to determine it accurately is essential. Using tools like the Qatar Gratuity Calculator simplifies the process, making it more accessible and transparent for all parties involved.
Gratuity in Qatar is not just a legal requirement; it’s a form of financial security that acknowledges an employee’s dedication and commitment to their work. By learning how to compute gratuity in Qatar, you can ensure that you receive the compensation you deserve, providing peace of mind as you navigate your career in this dynamic and thriving nation. Calculating end-of-service gratuity is an important aspect of financial planning for both employers and employees, and it plays a crucial role in promoting fair labour practices in Qatar.
