Calculating your salary in the UAE can be confusing, especially with different rules for expats and locals, various allowances, and overtime calculations. This comprehensive guide will explain everything you need to know about per day salary calculation in UAE, monthly salary breakdowns, and overtime rules.
How Salary is Calculated in UAE
In the UAE, salaries are typically calculated based on a 30-day month, regardless of the actual number of days in the calendar month. This standardization makes payroll calculations consistent throughout the year.
The basic salary calculation formula in UAE is:
Daily Salary = Monthly Basic Salary ÷ 30
Hourly Salary = (Monthly Basic Salary × 12) ÷ (52 × Weekly Working Hours)
Salary Components in UAE
UAE salaries typically consist of several components:
| Component | Description | Typical Percentage |
|---|---|---|
| Basic Salary | Fixed amount before allowances | 60-70% of total |
| Housing Allowance | For accommodation expenses | 25-35% of basic |
| Transport Allowance | For commuting expenses | 10-15% of basic |
| Other Allowances | Child education, cost of living, etc. | Varies |
Overtime Calculation in UAE
Overtime pay in UAE is governed by labor law and varies based on when the overtime occurs:
- Normal working days: 125% of normal hourly rate
- Weekends: 150% of normal hourly rate
- Public holidays: 250% of normal hourly rate
- Ramadan overtime: 125% with reduced working hours
For example, if your normal hourly rate is 50 AED:
- Weekday overtime: 50 × 1.25 = 62.5 AED/hour
- Weekend overtime: 50 × 1.5 = 75 AED/hour
- Public holiday overtime: 50 × 2.5 = 125 AED/hour
Differences Between Expats and Locals
There are some key differences in salary structure between expatriates and UAE nationals:
| Component | Expats | Locals |
|---|---|---|
| Basic Salary | Typically higher percentage | Often lower percentage |
| Housing Allowance | Common benefit | Often higher amount |
| Transport Allowance | Standard benefit | Standard benefit |
| Child Allowance | Rare | Common benefit |
| Pension | Not applicable | Mandatory deduction |
Practical Examples
Example 1: Expat Monthly to Daily Salary Calculation
Ahmed is an expat with a monthly salary of 12,000 AED (8,000 basic + 3,000 housing + 1,000 transport).
Daily salary calculation: 12,000 ÷ 30 = 400 AED per day
Basic daily rate: 8,000 ÷ 30 = 266.67 AED per day
Example 2: Overtime Calculation
Sarah earns 6,000 AED basic salary monthly and works 48 hours per week (8 hours × 6 days).
Hourly rate: (6,000 × 12) ÷ (52 × 48) = 28.85 AED/hour
If she works 5 hours overtime on a weekend:
Overtime pay: 5 × (28.85 × 1.5) = 216.38 AED
Common Mistakes in Salary Calculation
Many employees and even employers make these common errors:
- Using actual calendar days instead of 30 days for monthly calculations
- Not including all allowances in overtime calculations
- Calculating overtime based on gross salary instead of basic
- Forgetting to adjust Ramadan working hours
- Miscalculating public holiday entitlements
Salary Trends in UAE 2023
According to recent surveys:
- Average expat salary in Dubai: 15,000-18,000 AED/month
- Average local salary in Dubai: 25,000-30,000 AED/month
- Highest paying sectors: Banking, Oil & Gas, Technology
- Most common allowances: Housing (85%), Transport (72%), Children's Education (38%)
Legal Requirements
The UAE Labor Law (Federal Decree-Law No. 33 of 2021) specifies:
- Maximum 48 hours per week (8 hours/day)
- 2.5 days minimum weekly leave
- Overtime cannot exceed 2 hours per day
- Salary must be paid in UAE Dirhams
- Wages must be paid at least monthly
For more information on UAE labor laws, visit the Ministry of Human Resources and Emiratisation website.
Conclusion
Understanding how your salary is calculated in the UAE is essential for both employees and employers. Whether you're an expat or a local, knowing how to compute your daily rate, overtime pay, and deductions ensures you're being paid correctly and can plan your finances effectively.
Use our UAE per day salary calculator above to get accurate calculations tailored to your specific situation, whether you're an expatriate or UAE national.
For related financial tools, check out our UAE Gratuity Calculator and Emirates NBD Loan Calculator.
