Questions & Answers
Pension eligibility for GCC nationals working in the UAE
Pension Contributions
Q1. Can GCC nationals contribute towards Pension & Social Security fund maintained in UAE? If yes, what are the procedures? Please explain.
Q2. For a GCC national working in the UAE, should the employer deduct his/her salary and remit the same to his/her pension fund in their respective country? If so please explain the procedures.
Q3. If a GCC national obtains Emirati nationality, what will be her pension contributions? What happens to her contributions made previously to her GCC pension fund?
Q4. I read on your website, that an employee under a limited contract has to provide a notice period to his/her employee under probation. Could you please clarify, which article in the labour law states an employee should compensate during probation?
Q5. Accrued leave salary to be settled with the end of service benefits, is it calculated on the basic wage/remuneration or wage/remuneration?
Dear Questioner,
Please find the answers below:-
GCC nationals employed in the UAE are entitled to a pension in accordance with the schemes established in their home countries.
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 the UAE nationals.
GCC nationals pension scheme is governed under GPSSA. Once an employee is registered with GPSSA, funds are deposited in his account as follows:
1. Both the employee and employer share in contributing to the pension fund which is eventually used as end of service benefit to the employee.
2. The insured employee contributes an amount equal to 5 per cent of his monthly salary
3. Parallelly, his employer (if a government entity) would contribute 15 per cent of his salary
4. 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.
Only the UAE national employees who hold a ‘family book’ are entitled to be enrolled in the GPSSA pension scheme and are therefore not entitled to receive the end of service gratuity.
Those UAE nationals who are ineligible for registration are entitled to receive an end of service gratuity payment (or be registered with a qualifying company pension scheme) in accordance with the UAE labour law.
In contrast, GCC nationals qualify for registration solely based on their nationality and the ability to prove this – there is no requirement to provide a family book or equivalent.
For the GCC nationals who obtain Emirati nationality, pension eligibility will be based on the family book.
Regards,
Rajasree Ravivarma
