Pensions for federal employees
The UAE Federal Law No. 7 of 1999 Concerning the Issuance of the Law on Pensions and Social Security as amended by Federal Law No. 7 of 2007 (PDF, 500 KB) applies to UAE nationals (men and women) working in the government and private sectors.
The Law also covers the following categories of people working in the UAE:
- Emirati employers
- Emirati who are self-employed
- Citizens of the Gulf Cooperation Council (GCC) countries
The retirement age for Emiratis is 49 and for expatriate residents is 60. Expatriates who are older than 60 are allowed to work up to the age of 65 after obtaining approval of the Minister of Human Resources and Emiratisation or the Undersecretary. After the age of 60, labour cards are renewed annually.
UAE nationals working in government and private sectors are eligible for pensions and other retirement benefits after reaching the retirement age of 49 or after serving for 20 years minimum.
Emiratis receive pension in accordance with Federal Law No. 7 of 1999 Concerning the Issuance of the Law on Pensions and Social Security (PDF, 500 KB).
The entitlement of the insured to the pension commences on the day that follows the termination of his service and ceases upon his death provided he has no beneficiaries.
In case he has beneficiaries, the entitlement to the pension shall be transferred in accordance with the provisions of the Law.
The entitlement of the beneficiaries of the insured or the pensioner commences as of the month that follows the date of death.
Article 16 of the Law provides for the cases in which insured nationals are entitled for pensions.
An employer (whether government or private) must register the Emirati employees for the pension scheme within no later than one month from their joining date.
Emirates ID, family book and proof of employment are some of the conditions required for registration in the federal pension scheme.
At the federal level, General Pensions and Social Security Authority (GPSSA) is the federal body responsible for administering the pensions for all of the UAE national working force in the federal ministries and entities and local governments in Dubai, Sharjah, Ras Al Khaimah, Ajman Umm Al Quwain and Fujairah emirates.
Once an employee is registered with GPSSA, funds are deposited in his account as follows:
- both employee and employer share in contributing to the pension fund which is eventually used as end of service benefit for the employee.
- the insured employee contributes an amount equal to 5 per cent of his monthly salary
- parallelly, his employer (if a government entity) would contribute 15 per cent of his salary
- if his employer is a privately owned company, the employer would contribute 12.5 of his salary and the government would contribute 2.5 per cent.
Employers who fail or delay pension contributions are liable to be fined.
Useful links from the GPSSA website:
Citizens ineligible for pension scheme
UAE nationals who are ineligible for pension scheme will receive end of service benefits in accordance with the provisions of Articles 38 to 42 of the Federal Law No.7 of 1999 on Pensions and Social Security (PDF, 150 KB).
Accordingly, the benefit will amount to a salary of one and a half months for every year of the first five years, and it will increase to a salary of two months for every year of the following five years, and to a salary of three months for any additional year thereafter.
Should the insured pass away, his entitlement for the period of service must be paid to the beneficiaries in accordance with the provisions of the Pensions law above. In the absence of beneficiaries, such benefit would be distributed as per the provisions of the Islamic Shari'a with regard to inheritance.
Retirement rules of Dubai Government
H. H Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, has issued Decree No. 21 of 2017 approving the retirement and pension procedures applicable to Dubai government employees. The decree aims to ensure equal opportunities for Dubai government employees and further protect the rights of pensioners.
According to the decree, Dubai government human resources department (DGHR) will form a committee to evaluate the retirement requests of employees. A representative of DGHR will chair the committee. The committee is composed of representatives from Dubai's Department of Finance, the General Secretariat of Dubai Executive Council and the General Secretariat of Dubai's Supreme Legislation Committee.
The decree also defines retirement procedures. Pursuant to the decree, Dubai government entities must refer their employees' retirement requests to DGHR. The application must clarify the reasons for retirement and provide all the required information and documents and meet any other requirements set by the committee. The government entity is responsible for completing the application, satisfying the requirements and completing the documents prior to submission to the committee.
DGHR is responsible for following up the committee's recommendations, including referring its recommendations to the General Secretariat of Dubai's Supreme Legislation Committee to issue the required legislation prior to submission to His Highness the Ruler for final approval.
Pension for GCC nationals
GCC nationals employed in the UAE are entitled for pension in accordance with the schemes established in their home countries. GCC citizens who are working in any GCC member country outside their home country are entitled to pension.
GCC nationals' monthly subscriptions
The employers in the UAE are liable to mandatory subscriptions for their GCC employees according to the social security law in their home countries in terms of registration and subscriptions, provided that the same may not exceed the subscription share designated for the employers to UAE nationals. For more details read the GCC Overview.
Updated on 28 Jul 2020