Abu Dhabi, 11th September 2023: The UAE government bears 2.5% of the contribution amount for private sector Emirati employees as part of the “NAFIS” program, under condition that information and data for both the entity and the employee is continuously updated with the General Pension and Social Security Authority (GPSSA).
The government covers the contribution account salary difference for insured Emiratis employed in the private sector in accordance to the value of the salary and study certificate on behalf of the entity during the first five years of their employment. In order for this to be achieved successfully, the entity and the employee’s data need to be up-to-date on GPSSA’s electronic records, since the information is linked to the Ministry of Human Resources and Emiratisation.
The contribution rate due from insured Emiratis employed in both government and private sectors is 20%, out of which the insured individual bears 5%, while the entity pays 15%, out of which 2.5% is paid as support by the UAE government for Emirati employees working in the private sector, resulting in the private sector entity only paying 12.5%.
It is important to note that an insureds age at the time of appointment should not be less than 18 years and not exceed 60. Additionally, the insured individual must be medically fit to work with proof of a medical report from a medical authority approved by the GPSSA. All the provisions related to the law regarding the registration process apply to individuals who obtain the UAE nationality at any time.
Taking advantages of the “NAFIS” program requires full cooperation from both registered entities and insured Emiratis who need to ensure that monthly contributions are paid in a timely manner, i.e. contributions must be paid to the GPSSA from the beginning of the month and may be extended to the 15th day of that same month. Late or missing contributions result in the entity paying an additional amount of 0.1% of the payable contributions per delayed day, without the need to send a warning or notice.
All Emiratis employed in federal, government and private sectors in various emirates across the UAE are covered by the provisions of the Federal Law no. 7 of the year 1999 on Pension and Social Security and its amendments, with exception to employees working in government of Abu Dhabi and Sharjah, as well as those employed in the private sector in Abu Dhabi. Employers whose main headquarters are located in the rest of the emirates are subject to the provisions of the law, including their branches in other emirates.
Additionally, free zones and entities operating in the filed of tourism and hospitality who employ Emirati’s are subject to the provisions of the law, given that they verify their legal position and register their employees with the GPSSA as per above mentioned regulations. Entities who do not employ Emiratis are not required to register with the GPSSA.