Abu Dhabi: The UAE Ministry of Human Resources and Emiratisation has set out four levels for calculating end-of-service gratuity for foreign workers in the private sector: fractions of a year, the first period, years of service and the maximum gratuity.
The ministry said the gratuity is calculated at 21 days’ wages for each of the first five years of service and 30 days’ wages for each additional year.
Workers are also entitled to gratuity for fractions of a year in proportion to the period worked, provided they have completed one continuous year of service. The total end-of-service gratuity must not exceed two years’ wages, in accordance with applicable regulations.
The ministry explained through its social media accounts that employers are required to pay end-of-service benefits and any wages due to workers within 14 days of the termination of their contracts.
It also highlighted an optional alternative system for end-of-service benefits, known as the savings system, which allows end-of-service benefits to be invested and grow through licensed and approved investment funds.
The ministry also highlighted three channels for registering labour complaints related to domestic workers when disputes between workers and employers cannot be settled amicably. Complaints can be filed through the MOHRE UAE app, the ministry’s website or by contacting the Labour Claims and Consultation Centre on 80084.
The ministry also outlined the benefits of the optional savings system, under which amounts allocated for the end-of-service gratuity of employees working in private sector companies are invested in leading investment funds approved by the Securities and Commodities Authority, allowing employees’ savings to grow through investment returns.
It said the savings system aims to support the UAE’s economic system, enhance the protection and well-being of the country’s workforce, increase individual investment returns for beneficiaries and allow workers to make additional optional contributions.
The system also aims to enhance the attractiveness and flexibility of the labour market by improving services provided to workers, while taking advantage of opportunities to invest funds in investment instruments for economic activities in the country.
Source: Emirates 24|7