UAE Pension Law 2025: a Complete Guide to Gpssa, Dews & End-of-Service Benefits

The United Arab Emirates has long been a hub for global talent, attracting professionals from across the world. A key component of the nation's robust employment framework is its approach to pensions and end-of-service benefits. As the legal landscape evolves, staying informed about the latest developments in the UAE pension law is crucial for both employers and employees. The year 2025 marks a significant period of transition, with recent legislation refining the systems managed by the General Pension and Social Security Authority (GPSSA) and introducing new schemes like the DIFC Employee Workplace Savings (DEWS) plan. Understanding these changes is essential for ensuring financial security and legal compliance.

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This article provides a comprehensive overview of the UAE pension law and end-of-service landscape in 2025. We will delve into the specifics of the GPSSA for Emirati citizens, explore the DEWS plan for employees in the Dubai International Financial Centre (DIFC), and clarify the end-of-service gratuity system for expatriate workers in the private sector. Whether you are an employer navigating your obligations or an employee planning for your future, this guide will equip you with the essential knowledge to understand your rights and responsibilities under the current UAE pension law.

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The Role of GPSSA in the UAE Pension System

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The General Pension and Social Security Authority (GPSSA) is the federal body responsible for managing pension and social security for Emirati citizens working in both the public and private sectors across the UAE. Established under Federal Law No. 6 of 1999, the GPSSA plays a pivotal role in providing a social safety net and ensuring a stable income for Emiratis after retirement. Recent updates to the UAE pension law, particularly Federal Decree Law No. 57 of 2023, have introduced significant changes to the GPSSA framework, aiming to enhance its sustainability and effectiveness. These changes underscore the government's commitment to strengthening the UAE pension law system for its citizens.

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One of the key amendments is the increase in the maximum contribution account salary for Emiratis in the private sector, raising it from AED 50,000 to AED 70,000. This change, effective from 2023, means that higher-earning individuals can accrue a larger pension pot over their careers. Furthermore, the contribution rates have been adjusted. For new Emirati employees joining the workforce after the law's enactment, the total contribution is 26% of their salary, with the employee paying 11% and the employer contributing 15%. For existing employees, the rates remain at 20% (5% from the employee, 12.5% from the employer, and 2.5% from the government). Navigating these complex contribution structures can be challenging, and our expert team at Nour Attorneys provides specialized Labor & Employment Law Advisory to ensure full compliance.

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Merging Service Periods

A significant feature of the GPSSA system is the ability for employees to merge previous service periods to ensure a continuous contribution history, which is vital for calculating the final pension. As of September 2025, the GPSSA has extended the payment period for merging service to 10 years, offering greater flexibility to employees. This allows individuals who have moved between jobs or sectors to consolidate their pensionable service, maximizing their retirement benefits. The process involves submitting a request to the GPSSA and paying the associated costs, which are calculated based on the salary at the time of the request.

DEWS: A Modern Approach to End-of-Service Benefits in the DIFC

For expatriate employees working within the Dubai International Financial Centre (DIFC), the traditional end-of-service gratuity system has been replaced by the DIFC Employee Workplace Savings (DEWS) plan. Launched in February 2020, DEWS is a defined contribution plan that requires employers to make monthly contributions into a professionally managed and regulated savings vehicle. This progressive initiative aims to provide greater security and transparency for employees, ensuring that their end-of-service benefits are funded and invested throughout their employment.

Under the DEWS plan, employers are required to contribute a percentage of the employee's basic salary. The contribution rate is 5.83% for employees with less than five years of service and 8.33% for those with five or more years of service. These funds are then invested in a default fund or other investment options chosen by the employee, allowing the savings to grow over time. The DEWS plan represents a significant shift from the unfunded, pay-as-you-go gratuity system, offering a more secure and portable benefit for the DIFC's large expatriate workforce. For employers and employees in the DIFC, understanding the intricacies of DEWS is not just a matter of financial planning but a legal requirement under the evolving UAE pension law framework. Our legal experts can provide detailed guidance on End of Service Gratuity in the UAE, including the transition to and management of DEWS plans.

End-of-Service Gratuity for Expatriates in the UAE

For the majority of expatriate employees working in the UAE (outside of the DIFC and other free zones with similar schemes), the end-of-service gratuity remains the primary form of retirement or severance benefit. Governed by the UAE Labour Law, Federal Decree-Law No. 33 of 2021, the gratuity is a lump-sum payment that employers are legally obligated to pay to employees upon the termination of their employment contract, provided they have completed at least one year of continuous service. This forms a crucial part of the broader UAE pension law and employee benefits landscape.

The calculation of the end-of-service gratuity is based on the employee's last basic salary and their length of service. The formula is as follows:

Length of Service: Gratuity Calculation 1 to 5 years: 21 days' basic salary for each year of service More than 5 years: 30 days' basic salary for each year of service thereafter

It is important to note that the total gratuity payment cannot exceed the equivalent of two years' salary. The law also outlines specific conditions under which an employee may be dismissed without receiving their end-of-service gratuity, such as in cases of gross misconduct. Given the financial significance of the end-of-service gratuity, disputes can often arise. Seeking professional legal advice is the best way to ensure that the calculation is correct and that your rights are protected. If you are facing a dispute over your final settlement, our team can provide the necessary legal support.

Conclusion

The UAE pension law and end-of-service benefit systems are designed to provide financial security for both Emirati citizens and expatriate workers. The GPSSA continues to evolve, offering enhanced benefits and greater flexibility for Emiratis, while schemes like DEWS in the DIFC are modernizing the way end-of-service benefits are managed for expatriates. For those under the mainland UAE Labour Law, the end-of-service gratuity remains a critical component of their final settlement.

Navigating this complex legal and financial landscape of UAE pension law requires a clear understanding of the various laws and regulations. Employers must ensure they are compliant with their contribution obligations, while employees should be aware of their entitlements and how to plan for their future. At Nour Attorneys, we are committed to providing expert legal guidance on all aspects of UAE employment law. Whether you need strategic deployment with pension contributions, end-of-service calculations, or employment disputes, our team is here to partner with you secure your rights and achieve a favorable outcome.

Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal advice. Readers should seek professional legal advice tailored to their specific circumstances before making any decisions or taking any action based on the content of this article.

Nour Attorneys Team

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