The UAE has issued a new federal law that seeks to ensure efficiency and equality in the pension system for Emiratis and provide more flexibility and benefits for pensioners, including working mothers.

The General Pension and Social Security Authority (GPSSA) said on Friday that under the new law, “insured women who are married, divorced or widowed may request retirement pension, where the minimum age and the subscription period may be reduced if she is a mother of five or more children”.

In a statement, the GPSSA explained that working mothers can benefit from retirement pension at a younger age and with a shorter subscription period. If the mother opts to take leave to care of her children, she can also maintain her optional subscription, in accordance with the terms and conditions.

“In support of the family’s vital role in society, the new law grants working mothers more flexibility and benefits,” the statement said.

Efficiency, sustainability

The provisions are stipulated in the new Federal Decree Law No 57 of 2023 on Pension and Social Security, which seeks to improve pension policies and ensure the efficiency and sustainability of the financial resources of pensions.

“It also aims to enhance the flexibility of the pension and social security services in the UAE, and to mitigate any gaps in services and policies provided to the UAE nationals working in the government and private sectors,” the authority said.

“The law will [also] bring further equality in insurance benefits to encourage UAE nationals to join private sector companies.

Other key provisions in the new law

The new law has also increased the maximum contribution salary for Emirati citizens working in the private sector from AED50,000 to AED70,000.

 The new law stipulates that the pension will be calculated for both government and private sectors “based on the average monthly contribution account salary according to the last six years" of service.

To be eligible for retirement pension, the insured should be at least 55 years old and have subscribed to the pension for 30 years.

The new Federal Decree Law is applicable to Emirati employees who joined the labour force for the first time from the date of its publication onward in organisations participating at the GPSSA.

The pensioner from the government or private sector, whose subscription period has reached 30 years, has the right to combine the pension with a salary from a new job.

Besides mothers, those who wish to take unpaid leave to pursue postgraduate studies are also allowed to maintain the subscription in the pension for the duration of their leave, in accordance with the terms and conditions set by the authority.

(Writing by Cleofe Maceda; editing by Seban Scaria)