Companies must enrol Emirati employees with GPSSA and make contributions on their behalf
UAE: In 2022, inspectors from the UAE’s pension administration visited 135 firms to ensure that the enterprises were following the laws. According to the law, companies are compelled to register Emirati workers with the General Pension and Social Security Authority (GPSSA) and make contributions on their behalf.
According to the GPSSA, its inspectors discovered many violations, including failing to register Emirati employees, failing to make contributions on their behalf, charging for higher contributions, making payments based on incorrect wages, and failing to define the employment relationship clearly and appropriately among others.
Although businesses are obligated to work with the GPSSA to comply with the law, insured Emiratis are still responsible for “monitoring his/her registration and monthly contributions”.
Breaches and Penalties
For Emirati employees, contributions are required to be made from the first of the month to the fifteenth, according to the GPSSA. For each day that the payment is delayed, the entities are assessed 0.1% of the contributions that are owed.
A fine of Dh5,000 is assessed against any employee who fails to make contributions on behalf of insured people. If the entity reduces a higher percentage of contributions, the same penalty is imposed.
The employer must pay a penalty equal to 10% of the amount of the payments due from the insured if they pay their contributions using incorrect wages or do not pay them at all.
A Dh5,000 fine and/or imprisonment are levied against anyone who knowingly withholds information on a purpose to acquire funds unfairly from the GPSSA or provides false information to its inspectors.