End-of-service benefits: Emiratis must complete at least one year on job

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Emirati employees need to complete a minimum of one year in their jobs to receive their end-of-service payment from the General Pension and Social Security Authority (GPSSA). The minimum period for an insured individual to spend at an entity is “11 months and one day, given that the ‘one day’ is considered ‘a month’ as per the UAE Pension Law.”

According to statistics released by the GPSSA in 2022, about 1,461 out of 6,138 Emiratis were not entitled to receive their end-of-service benefits as they had left their jobs in less than a year. The GPSSA recorded 24 per cent of end-of-service cases not meeting the proper entitlement conditions.

The UAE Pension Authority explained that the longer the employment duration, the more the benefits for an insured individual. “This includes an increase in the value of the end-of-service reward,” the authority said.

It noted that the salary by which a bonus is calculated is that of the pension account itself. Insured individuals receive one-and-a-half months’ salary for each of the first five years of service; two months’ dues for each of the following five years; and three months’ salary for each of the next five years.

“During this period, insured persons receive all their insurance rights. As an example, the maximum pension of 100 per cent is granted to individuals exposed to a work-related disability, or in case the insured passes away, which is exactly what an insured individual who works and contributes for 35 years receives. Additionally, insured Emiratis may choose to add employment periods when shifting entities,” the GPSSA added.

The authority called on all members to verify their registration and contribution payments as soon as they are recruited. “There were numerous cases reported whereby employees resign for any reason, and upon joining a new entity discover that they are unable to join unless they pay their registration and contributions first.

In such cases, both the employee and the previous employer are forced to pay due contributions retroactively and bear the value of the additional amounts as a result of the delay in paying the contributions. This puts the insured under risk of delaying or even losing the opportunity to be recruited by another entity.”