The recently announced end-of-service savings scheme for expatriates working in Dubai’s public sector offers foreign workers an outstanding opportunity to invest and grow their savings. The employer will contribute the worker’s total end-of-service gratuity to the scheme while the employee can choose to make additional personal contributions if he so wishes. The rate of return will depend on the total invested amount, its distribution across available investment portfolios, and the associated risks with each category of investment.
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This major milestone came about as a consequence of amendments authorized by the Steering Committee of the ‘Savings Scheme for Foreign Employees in the Government of Dubai’.
When it comes to enhancing the working and living circumstances of expatriates, the government is leading by example. This new scheme is now mandatory for employees within the public sector while optional for private sector enterprises that may want to utilize the workplace savings plan. This initiative by the government is also encouraging private firms to embrace more worker-friendly measures that guarantee the latter’s financial security by growing their gratuity. Overall, this measure will further strengthen Dubai’s position as a leading destination for expat workers from around the world.
Following these reforms, the UAE has also introduced a new company classification system that will split private firms across three distinct categories and provide incentives and exemptions for businesses based on certain factors. These include their dedication to the law and the wage protection system and their commitment to preserving employee rights. The classification system will also consider a company’s cultural and demographic diversity and see how it is adhering to the resolutions that regulate the labor market.
The new classification will use an automated system that will change a company’s status transparently. Worker-friendly firms will be placed in the top tier and be able to enjoy a number of exclusive benefits. The end-of-service savings scheme is being adopted to appeal to skilled workers but will also facilitate expatriates in gaining added monetary security in the face of growing inflation. Additionally, the latest developments will ensure that employees’ rights are protected in line with international standards.
It is the country’s first legislation of its kind and ensures that employees receive a series of financial perks. Some of its most crucial points are listed below.
The workplace savings scheme is originally intended for public sector employees in the Dubai Government but private sector firms can also make use of the program. According to Law No. (8) of 2018, in the administration of human resources for the Government of Dubai, expatriates working in government organizations would be automatically enrolled in the scheme and ensure employee financial wellness.
According to Dubai’s Human Resources Act, an employer’s contribution to the program will equal the end of service rewards owed to the expat employee. Consequently, if an expat employee is promoted or changes position or responsibility, a change in contributions will become effective.
At the conclusion of the employee’s service, their participation in the program will stop. At this point, workers can choose to withdraw their end-of-service gratuity sum or continue to stay in the program.
Organisations of all sizes in the UAE can now create their own tailored workplace savings plan at no extra cost. If you are an HR manager, Finance Officer, or Operations manager with access to employee records, you can Register your organisation for free and launch your workplace savings plans, and employee financial wellbeing program for free.
The new legislation regulating the provision of savings programs for expatriates will not only offer stability to employees but will also enhance employer-employee ties. This program is one of the many initiatives that showcase the government’s willingness and commitment to ensure employee satisfaction and acknowledges their devotion to community service. Such initiatives serve to maintain Dubai as one of the most sought-after destinations for skilled professionals seeking career opportunities from all over the world.
