GPSSA explains an employer’s obligations to register and contribute on behalf of the insured
In accordance with Decree Law No. (57) of 2023
Abu Dhabi, 12 th December 2023: The issuance of Decree Law (57) of 2023 regarding pension and social security, requires UAE-based federal, government and private sector entities to register insured Emirati employees within one month from their joining date, and to provide the General Pension and Social Security Authority (GPSSA) with names of employees whose service ends within 15 days at the most from their end-of-service date.
Violating the above condition results in the entity paying a Dh200 fine for each day delayed and for each insured employee whose registration process has not been complete.
In order to qualify for the registration requirements, set by the GPSSA, insured individuals must fulfil various requirements, namely: they must have the UAE nationality, their age at the time of contribution must not be less than 18 and not more than 60, and they must be medically fit to work upon appointment according to an approved medical report.
The official document prepared to prove the insured’s age must be issued by a competent UAE-based authority and submitted to the GPSSA when contributing for the first time. Any age-related amendments are considered if and when they are made within a period not exceeding one year from the contribution date.
Once an insured joins an entity subject to the provisions of the UAE Pension Law, he/she must register with the GPSSA, then register on behalf of the insured. These services are available on GPSSA’s website in the employer’s service portal.
The employer must pay the contributions due from the insured according to the contribution account salary and not the total salary; these contributions are paid according to the new law at a rate of 26%, out of which the insured bears 11% and the employer bears 15%. In a quest to encourage private sector entities to recruit UAE nationals, the government will support Emiratis whose contribution account salaries are less than Dh20,000 by paying 2.5% on behalf of the private sector entity.
Employers must pay contributions on time on the 1st of the month following the month by which they are due, and this payment may be extended until the 15th day of the month, noting that the amount is non-refundable.
In the event of a delay in contribution payments, the entity becomes obligated to pay an additional amount of 0.1% of the due contributions for each day delayed, without the need to send a notice or warning. It is important to note that any additional amounts must not exceed the value of the contributions due, and that a part of the month during which an insured join’s or leaves his/her work, is calculated as one full month by which his/her contributions must be paid.
Employers are obligated to pay the contributions on real salaries, otherwise, the UAE Pension Law requires insured individuals, in the event of a violation to this regulation, to pay an additional amount of 10% of the value of contributions due, without the need to send a prior warning or notification. GPSSA’s Board of Directors may determine total or partial exemption from paying additional amounts, as per exemption conditions.
Entities must provide the GPSSA with statements, data or documents within ten working days for the purpose of verifying the contribution rates for the insured; failure to do so results in Dh100 fine for each day delayed, for each insured person. The GPSSA calculates the contributions according to what it decides in the case of violators.
