United Arab Emirates: Fee Eliminated to Merge End-of-Service Benefit for Emirati Nationals Registered with the General Pension and Social Security Authority
May 25, 2023
The General Pension and Social Security Authority (GPSSA) launched a new project, “Shourak,” to benefit Emirati nationals in the private and public sectors with their end of service gratuity. The GPSSA is a pension scheme available to all Gulf Cooperation Council nationals, while two other pension schemes are available only to Emirati nationals who are employed in Abu Dhabi or Sharjah. Currently, Emirati nationals must collect their end-of-service gratuity when they stop working for their current employer and they can choose to pay a fee to have it deposited back into their pension account to be paid out at as a pension salary when they retire. However, when the related rule goes into effect on July 1, 2023, GPSSA-insured Emirati nationals who join Shourak within six months from their end-of-service date will no longer need to pay this fee if they choose the latter option and elect to merge their end-of-service benefits within one month of starting work for their new employer. These end-of-service payments stem from monthly contributions that UAE employers pay to the GPSSA during the Emirati national’s employment; the contributions also pay for the employee’s pension upon retirement.
This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].
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