All private sector organizations must register their Emirati employees with the General Pension and Social Security Authority (GPSSA) within 30 days of the date of employment as part of the government’s federal program (NAFIS).
The same goes for the obligation of an employee to see that registration is finished within a month of their start date.
According to GPSSA, this is a part of the government’s initiative to improve the sustainability and competitiveness of UAE citizens by allowing them to work in the country’s private sector over the following five years. The NAFIS program was introduced as one of the “Projects of the 50,” which aims to quicken the UAE’s development process.
Emiratis working in the private sector are given options and benefits through NAFIS, such as the Emirati Salary Support Scheme, a Pension Program, a Child Allowance Scheme, a Talent Program, an Apprentice Program, Recruitment Targets, a National Healthcare Program, an Unemployment Benefit, a Vocational Counseling Program, Job Offers, and an On-the-Job Training Program.
All private sector organizations in the UAE, except Abu Dhabi, are required to pay their pension contributions at the beginning of each month, with a maximum grace period permitted until the middle of each month. One of the program’s requirements is that private companies with at least 50 employees reach their 2 percent Emiratization target before January 2023.
After becoming insured with the GPSSA, individuals are required to pay their share of contributions, which is 5 percent of the Contribution Calculation Salary, which the employer withholds from the employee’s pay and sends to the GPSSA every month. Additionally, they are required to pay 12.5 percent of the Contribution Calculation Salary, with the government contributing 2.5 percent as a form of support and encouragement.
The basic salary, gratuities, and allowances (to be paid regularly and months following the employment contract) are all included in the contribution calculation salary, which serves as the foundation for contributions made over a full year. If the insured begins working after January, the contribution payments will be based on that month’s contribution calculation salary until the following January.
Certain registration conditions must be met for an Emirati to be registered with the GPSSA, begin making monthly contributions, and get covered. This includes submitting the necessary paperwork, which includes copies of the following: Passport, Emirates ID, Family Book ID, Birth Certificate Copy, or Age Estimation Document. – the appointment letter, three completed copies of the insured’s “service start form” (service start form no. 1), the original copy of the employment contract attested by the Ministry of Labor, and a photocopy of the medical examination performed in conjunction with the appointment. The contributors’ age must be between 18 and 60, and they must be healthy enough to work at the time of registration.
The GPSSA issues an insurance number after an employee’s entity has completed the registration processes for that employee and all the aforementioned documents have been verified.
Employers in the private sector play a crucial role in the insurance work scheme at the GPSSA level, as is clear from statistics for October 2022, when the number of contributors working in the private sector registered with the GPSSA increased to 21,868 across 7,874 private sector entities.