Latest news with #FederalLawNo.7of1999
Zawya
22-04-2025
- Business
- Zawya
UAE: GPSSA calls on insured Emiratis to merge employment years
Insured Emiratis must ensure their employment years are continuous and uninterrupted and that they have completed the qualifying contribution period in preparation for their retirement years. The minimum period to obtain a retirement pension is 15 years and the insured reaching the age of 60, clarified the General Pension and Social Security Authority (GPSSA) as part of its April 2025 campaign on raising awareness regarding the eligibility criteria's and benefits in receiving a lucrative pension amount once retired. According to Federal Law No. 7 for 1999 an Emirati employee who decides to voluntarily resign, while looking to receive a pension payment, must ensure he/she has completed 20 years of service and has reached the age of 50 to receive a retirement pension. Those subject to the provisions of Federal Law No. 57 of 2023 are required to spend 30 years in service and reach the age of 55. The insured individual must ensure his/her employment/service period is continuous and uninterrupted. This is done through deciding to take advantage of merging previous and subsequent employment years in accordance with the provisions of Federal Law No. 7 of 1999 and Federal Law No. 57 of 2023 or accessing the 'Shourak' programme, which helps facilitates a merge request for those who have entered the labor market starting from 1st July 2023 onwards. If the above-mentioned employer transfer decisions and the merge process timings are not fully met, the insured will be forced to start saving for a pension entitlement from scratch. To avoid such inconvenience, while preserving previous employment years upon completing the minimum eligibility service criteria's the insured can opt to merge employment years, given he/she bears the financial payments that arise because of taking such a decision As per Federal Law No. 7 of 1999, the insured receives 70 percent of the pension account salary once 20 years of service have been proven to be complete. This percentage increases by a further 2 percent for each year the insured spends after the 20 years period and up to 100 percent of the pension amount if employed for 35 years. Federal Law No. 57 of 2023 claims that the insured must spend 30 years in service to obtain a retirement pension. In such case, pension is calculated at a rate of 2.67 percent for each year up to 30 years of service and at the rate of 4 percent for each year exceeding 30 years for up to 35 years of service, which is the period of obtaining the 100 percent of the pension amount, given that the insured is granted three salaries from the pension account for each year spent working after the 35 year period.
Gulf Insider
23-03-2025
- General
- Gulf Insider
UAE Announces End-Of-Service Benefit Rule For Mothers
The UAE has clarified rules for Emirati mothers regarding pensions and social insurance payments. The General Pension and Social Security Authority (GPSSA) has confirmed that under Federal Law No. 57 of 2023, Emirati mothers who wish to take leave from their jobs to look after their children are granted the opportunity to do so for a maximum of three years given that they continue to pay monthly contributions to secure themselves with a lucrative end-of-service benefit. GPSSA highlighted the UAE's commitment to supporting and empowering Emirati women across various fields, including legislation, education, economy, and politics. This dedication reflects the nation's belief in the significant role women play in strengthening and developing the country, a vision established by the late Sheikh Zayed bin Sultan Al Nahyan, who recognised the integral role of women in all aspects of life. The UAE, under its wise and prudent leadership, continues to pursue this approach towards empowering women across all sectors, ensuring their active participation in the nation's progress. In recognition of the traditional roles and societal contributions of working Emirati women, pension laws have been tailored to provide them with certain benefits, as outlined in Federal Law No. 57 of 2023, which offers optional contribution rights for Emirati women. Additionally, special provisions are granted to female breadwinners, particularly in the event of their husband's passing. For example, widows are entitled to merge their pension amounts with that of their deceased husbands. Additionally, UAE Federal Law No. 57 regarding pension and social insurance and its amendments redistributes pension percentages among beneficiaries by raising the widow/s entitlement shares. If the widow has more than one child she receives a 40 per cent pension share, while children (male and female) are entitled to 40 per cent share of the pension; the father or mother or both are entitled to 20 per cent of the pension share. This distribution of shares has raised the widows' percentages at the expense of her children, since she supports them after the decease of the breadwinner. The law has also reduced the age and contribution duration for married, divorced or widowed females with children in the UAE given that they have contributed with the GPSSA for 30 years and reached the age of 55. This has resulted in a reduced two years of contribution payments and three years in age for each of an Emirati mother's fifth and sixth child, and 3.5 years less in contributions and four years for the seventh child. The support towards females was evident prior to Federal Law No. 57 of 2023 as shown in UAE Federal Law No. 7 of 1999 regarding pension and social security and its amendments, which grants women the right to purchase ten years of service, while men are allowed to purchase only five years. The pension law also allows the repayment of the share for each daughter and sister. The pension amount however is immediately suspended in case a daughter gets married, joins an entity due to a divorce or leaves a job, while the son stops receiving pension once he reaches the age of 21 or 28 in case he is still studying, contrary to a daughter who does not stop receiving pension due to age related reasons. If the mother, sister or daughter become widowed or divorced after the decease of the pensioner and neither of them receive an alternative salary or pension, a share is created for them equal to the share amount at the time the pension is due, without prejudice to the shares of the other beneficiaries. Moreover, the law provides equal distribution of pension payments among daughters and sons, with daughters being entitled to the same share amount as sons, since the federal pension law does not consider pension a legal inheritance. Contrary to popular belief, a woman's pension is distributed to her eligible family members, similar to that of a man.
Zawya
10-03-2025
- Business
- Zawya
GPSSA clarifies the conditions for the purchase of service years for Emiratis looking to retire at an early age
Abu Dhabi: Insured Emiratis who wish to receive a lucrative pension rate and retire early may revert to purchasing inactive service years in addition to their actual years of employment as per federal pension laws, stated the General Pension and Social Security Authority (GPSSA). GPSSA's service 'Purchase of Service Years' differs from one federal law to another. According to Federal Law No. 7 of 1999 regarding pension and social security and its amendments, the insured must have spent 20 years employed in an entity, while in Federal Law No. 57 of 2023, (whose provisions apply to those joining employers for the first time after the 31st October 2023), the insured must have served not less than 25 actual service years when submitting the purchase request, or 15 years if he/she has reached the age of 60. Approved purchase of service years Insured males can purchase an additional five service years while females are able to purchase ten service years under the provisions of Federal Law No. 7 of 1999 on Pension and Social Security and its amendments. However, the service years that can be purchased differs for those covered under Federal Law No. 57 of 2023 on Pension and Social Security, which limits the purchase period to five years for both genders. Longer service years results in higher pension percentage The percentage granted by each purchased service year varies in accordance with the pension laws applied by the GPSSA. While purchased years grant an insured male or female an increase of 2% in accordance with Federal Law No. 7 of 1999, an increase of 2.67% is granted to employees whose contribution period is from 25 to 30 years. As for the pension calculation scheme in Federal Law No. 57 of 2023, the insured receives 4% for each year employed that exceeds 30 years. Purchase ceiling for service years Other than the period required for the purchase of service years, the length of service that can be purchased and the percentage of increase for each year, there are no other fundamental differences in the purchase rules between the two federal laws. In this context, it is important to note that the period that qualifies an individual to receive the maximum pension amount should not exceed 35 years. Cost of purchase of service years Purchase costs are calculated based on the contribution account salary on the date of submitting the request, multiplied by 20%, which is the percentage of contributions received by the employer and the insured for the purchased period, multiplied by the period to be purchased in months. For example, under Federal Law No. 7 of 1999, if the insured's contribution account salary is AED20,000 and he/she wishes to purchase five years, the calculation for this is AED20,000 x 20% x 60 (months) = AED240,000. As for those covered by Federal Law No. 57 of 2023, the purchase costs are calculated on the basis of the contribution account salary on the date of submitting the purchase request, multiplied by 26%, multiplied by the period to be purchased in months. For example, if the salary of an insured's contribution account is AED20,000 and he/she wants to purchase five years, the calculation for this will be AED20,000 x 26% x 60 (months) = AED312,000. While employed in an entity To be eligible to purchase service years, the insured must be employed. If his/her service period ends without paying the full purchase cost, the purchased years are calculated based on the amounts actually paid. If the insured is deceased prior to completing payment, the installments will continue to be collected from his/her heirs. For more information, please contact: Dina El Shammaa Media and Public Relations Senior Specialist E-mail: Website:
