Following Law No. 57 of 2023, Emirati employees joining the workforce after October 31, 2023, witness a six percent rise in their monthly pension contributions, bringing the total contribution salary to 26 percent.
New Contribution Breakdown:
Under the updated regulations, Emirati employees now contribute 11 percent of the amount, while employers cover the remaining 15 percent.
However, for Emiratis in the private sector with contribution account salaries below Dh20,000, the UAE government provides 2.5 percent as an incentive to encourage their employment.
Previous and Current Contribution Rates:
Previously, employees contributed 5 percent, with employers contributing 12.5 percent, while the government covered the remaining 2.5 percent.
The revised rates mark a notable increase in employee contributions.
The General Pension and Social Security Authority of the UAE has clarified that government entities and private firms employing UAE citizens have a three-month transition period from October to December 2023 to adhere to the new contribution rates as stipulated in the law.
Circular Guidelines for Compliance:
A recent circular dispatched in November offers comprehensive guidelines to public and private sector entities.
These guidelines outline the protocols for facilitating contribution payments for Emiratis newly entering the workforce after October 31, 2023, and those not previously covered under Law No. 7 of 1999.
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