There is no state pension for expatriate workers in the UAE, and expats are about 88% of the workforce. What you get instead when you leave a job is a one-off end-of-service gratuity based on your basic salary. UAE and GCC nationals have a separate, proper contributory pension through the GPSSA. And since 2023 there are voluntary savings schemes that can replace or sit alongside the gratuity. This guide covers all three.
Under the federal Labour Law (in force since February 2022), a private-sector employee who completes at least one continuous year is entitled, when they leave, to a gratuity based on their last basic salary: 21 days' basic pay for each of the first five years of service, then 30 days' basic pay for each year beyond five, with the total capped at two years' basic pay. Partial years count pro-rata.
The same formula now applies whether you resign or are terminated — the old reduction for early resignation was removed. The key figure is basic salary: allowances (housing, transport) are excluded, so a package that is heavy on allowances produces a small gratuity. Use our gratuity calculator to see your figure.
A UAE national in the private or government sector contributes to the General Pension and Social Security Authority. The total contribution is around 26% of the pension-account salary — roughly 11% from the employee, 15% from the employer, with a government subsidy for private-sector employers. Abu Dhabi has its own fund (ADPF) with slightly different terms.
An Emirati is entitled to a pension on reaching the retirement age (60) with at least 15 years of contributions, or earlier with a longer contribution record. The pension is a share of the final salary that rises with years of service, up to a cap — a genuine retirement income, unlike the expat gratuity.
Since 2023 employers can enrol staff in a workplace savings scheme instead of accruing the gratuity as a promise: the DIFC's DEWS scheme, the ADGM equivalent, and a voluntary federal 'alternative end-of-service benefits' scheme where the monthly accrual is paid into a regulated investment fund. If your employer offers one, especially with a top-up, it usually beats an unfunded gratuity.
Either way, the gratuity is not a retirement income for an expat — it often works out to a few months' salary after years of work, and it is frequently spent on the move home. Since there is no state pension, your retirement plan is entirely what you build: a low-cost global index fund, property, or a personal pension. Start early and automate it.
Informational content, not financial, tax or legal advice. Check amounts, limits and current rules directly with the official sources (the Central Bank of the UAE, the Federal Tax Authority, Al Etihad Credit Bureau, and MOHRE) before making a decision.
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