GPSSA: Insured Emiratis must be registered within 30 days from the date of their employment
• The insured’s contributions are paid on the basis of the contribution account salary
• Deducting and paying contributions for the insured is an entities responsibility
•If the provisions and rules for paying contributions are violated the employer is mandated to pay additional costs
Abu Dhabi, 27th March 2024: Employers who are subject to the provisions of Federal Law No. (57) of 2023 regarding pension and social security are required to register their Emirati employees within 30 days from the date of their employment, stressed the General Pension and Social Security Authority (GPSSA).
Entities are required to provide the GPSSA with names of insured Emiratis whose service periods end within 15-days at the most. Violating this provision results in an additional charge of Dh200 for each day delayed, and this amount is multiplied in accordance to the number of insured employees working in the entity.
Contribution payments are the employer’s responsibility, which is why statements, data or documents (including the insured’s salary details), must be sent to the GPSSA by the entity within 10 days, in order to calculate the prearranged contributions as per the provisions of the federal law. In the event of delay, the entity pays an additional Dh100 for each day unsettled; an amount that is multiplied by the number of insured individuals.
In accordance to the provisions of Federal Law No. (57) of 2023, contributions must be paid in starting from the date the employee has joined the entity, even if that means him/her joining during the middle of the month or leaving the entity before the month is over.
Contribution payments must be transferred in the beginning of each month, with a maximum grace period of 15 days. The amount is non-refundable. In the event of late payments, the employer is obliged to pay an additional amount of 0.1% of the contributions due for each day delayed, without prior notice or warning. Additional amounts must not exceed the value of the contribution due.
Contributions must be paid based on real salaries, meaning that the insured’s payments are paid on the basis of the contribution account salary. It is important to note that contributions are paid for employees in the private sector according to the January contribution account salary of each year; and if the employee joins after January, contributions are calculated on the basis of the salary of the month by which he/she joined the entity until the following January. Contributions for employees working in the government sector are calculated in accordance to the actual contribution account salary for each month.
It is important to understand that non-payment of contributions on real salaries requires an employer to pay an additional amount of 10% of the value of contributions due, without warning or prior notification, whereas GPSSA’s Board of Directors get to determine the cases that are exempt from the additional amount, as well as whether it is a total or partial exemption.
The registration provisions also apply for individuals who have been granted the Emirati nationality while working with an employer who is subject to the provisions of this legal decree, starting from the date he/she obtained the citizenship, nothing that he/she may merge previous employment years in order to receive a higher pension and/or end-of-service gratuity, as per the provisions in Article (8) in federal pension law.
