MoHRE reviews proposals to channel employees’ end-of-service benefits into investment and savings funds.
The Ministry of Human Resources and Emiratisation (MoHRE) has completed the evaluation phase of policies for the Alternative End-of-Service Benefits Savings Scheme, with further improvements expected in the near future.
The review considered feedback and proposals submitted by stakeholders up to February 28, aiming to safeguard employee rights and support a stable UAE labour market
The Ministry emphasized that the public and stakeholders can take part in the digital consultation via the UAE Government Portal (Sharek.Emarat). Feedback gathered will guide decision-making and help enhance customer satisfaction and confidence.
Key proposals from stakeholders
Among the main suggestions submitted were:
- Transparency in investment funds: Stakeholders requested regular performance reports detailing returns, fees, and risks to boost public confidence.
- Practical comparisons: Examples illustrating expected returns from the alternative savings scheme compared with traditional end-of-service gratuity benefits.
The Ministry clarified that eligible participants include private-sector and free-zone employees, investors, self-employed professionals, holders of freelance work permits, UAE nationals in government and private sectors, and non-nationals employed by government entities and affiliated companies.
The survey also assessed participants’ awareness of the optional scheme, ranging from high awareness to no prior knowledge.
Investing end-of-service benefits through savings funds
Respondents provided feedback on the idea of investing contributions via approved savings funds, rating it as excellent, good, unsuitable, or unsure.
The consultation also examined potential challenges, including:
- Limited awareness among employees and employers
- Procedural complexity
- Preference for the traditional gratuity system
- Difficulties in selecting the appropriate investment pathway
Participants also shared opinions on the ideal timeframe to maximise benefits, with options ranging from less than five years, five to ten years, more than ten years, or no knowledge.
Communication channels for awareness
Participants highlighted their preferred channels for receiving updates and awareness materials:
- Preferred communication channels: Participants identified the Ministry’s official website, social media platforms, workshops and seminars, and email/SMS notifications as the best ways to receive updates and awareness materials.
- Factors encouraging adoption: Key drivers included clear procedures, flexibility in managing contributions, government guarantees, and employee education programs. Stakeholders were also invited to submit additional proposals to enhance scheme benefits.
Alignment with UAE government direction
MoHRE highlighted that consultation outcomes will guide policies aimed at protecting employee rights and fostering a sustainable work environment, ensuring alignment with government directives to maintain labour market stability and workers’ rights in the UAE.
Strengthening financial security
The initiative is part of wider UAE efforts to advance the labour environment and safeguard employees’ financial security.
Launched under Cabinet Resolution No. (96) of 2023, the optional scheme provides a sustainable alternative to traditional gratuity benefits, offering attractive investment returns and promoting a culture of savings.
Under the scheme, private-sector and free-zone employers can make monthly contributions into approved funds, including Lunate, First Abu Dhabi Bank, Daman Investments, and National Bonds. Companies can register either directly through the funds’ platforms or via the Ministry’s portal.
