Employees have the choice to either receive financial benefits after the termination of the employment contract or to continue investing in the end-of-service scheme.
The UAE’s alternative end-of-service scheme is now live and companies can approach the Ministry of Human Resources and Emiratisation (MoHRE) or the Securities and Commodities Authority to register.
Addressing a media briefing on Wednesday, Dr Abdulrahman Al Awar, Minister of Human Resources and Emiratisation, said participating in the system is optional for both employers and employees.
The scheme is open to employees working in the public and private sectors, and freezone entities. If employers decide to sign up for the scheme, they can specify the staff members who will be part of it.
Employees have the choice to either receive financial benefits after the termination of the employment contract or to continue investing in the end-of-service scheme.
The minister said employees can request for withdrawal of all or part of the voluntary contribution amounts and investment returns.
The end-of-service scheme for UAE employees working in public, private, and free zone companies offers an alternative system to the existing gratuity payment practice and aims to protect dues while ensuring they are invested safely.
The scheme is aimed at increasing investment revenues to subscribers and offers an additional voluntary contribution option.
The minister said skilled workers can increase their end-of-service benefits if they choose high-return funds.
How to register
The employer will submit a request to the Ministry of Human Resources and Emiratisation and then choose an approved investment fund. They need to choose the employees they wish to register in the scheme while ensuring their employees’ entitlements from the previous period are preserved.
The employer can select the investment fund and sign the subscription contract, identifying the fund administrator. The participation and registration of establishment staff in the scheme can be made through the fund administrator by opening a savings account for beneficiaries.
After the registration, the employer will transfer a voluntary monthly contribution from the beneficiary’s salary. The funds can be transferred in a lump sum directly to the scheme.
News Source: Khaleej Times
