ABU DHABI - The General Pension and Social Security Authority (GPSSA) has said that a contribution account salary is the salary by which an employer shares and that of the insured Emiratis share of contributions are due from the beginning of each month. The longer a person contributes, the better the pension or end-of-service benefits are.

As part of the “Know Your Law” awareness campaign, the authority said that the contribution amount as per Federal Law No.57 of 2023 regarding pension and social security is 26 percent, out of which insured Emiratis who have joined the workforce starting 31st October 2023 bear 11 percent, while the employer pays 15 percent; these contributions are paid according to the insured’s contribution account salary.

Additionally, the government bears a 2.5 percent share on behalf of private sector employees whose contribution account salaries are less than AED20,000 as a form of support for Emiratis working in the private sector.

The provisions for Federal Law No.7 of 1999 for pension and social security and its amendments apply to Emiratis employed before 31st October 2023 and entail a total of 20 percent in contributions, out of which the insured bears five percent, whereas the government and private sector bear 15 percent. The UAE government pays 2.5 percent of the percentage owed by the private sector entity as a form of support, similar to the 2023 federal law.

The contribution account salary, which is subject to deduction for Emirati employees working in the government sector, includes the insured’s basic salary, cost of living allowance, social allowance for children and the insured, and housing allowance, provided that the contribution account salary of the insured does not exceed AED100,000.

The law specifies the contribution account salary for private sector employees at a payment determined by their employment contract so that the contribution account salary is not less than AED3,000 and not more than AED70,000.

The contribution account salary for insured individuals employed in regional, international, or foreign missions operating in the UAE is based on the basic salary specified in the employment contract, in addition to benefits, bonuses, or allowances granted in exchange for his/her work.

The Decree indicated that GPSSA’s Board of Directors may determine the elements included in calculating the contribution account salary in cases whereby the employer applies a schedule for their employees’ salaries, contrary to what is stipulated in the provisions for calculating the contribution account salary.

According to the current Law No. 9 of 1999, the contribution account salary is AED300,000 in the government sector and AED50,000 in the private sector. An insured Emirati working in any regional, international or foreign missions operating in the UAE is not included in Law No. 9 of 1999, but they are included in the new Federal Decree Law No. 57 of 2023, with a maximum ceiling set for their contribution account salary at the same level as that of the private sector.