Pension
The retirement age for expatriate employees in the United Arab Emirates, excluding Sharjah and Abu Dhabi, is 60. Citizens of the UAE can retire at 49 if they have completed 20 years of service. At this age, employees become eligible for a retirement pension or have contributed to the pension scheme for a period of at least 15 years. Employees may also retire at any age if they have at least 20 years of insurance coverage.
The pension amount equals 60% of the average salary in the last five years, plus 2% per year of contribution beyond 15 years until it reaches 100%. If the service period exceeds 35 years, an amount equal to three month's salary is paid for every additional year.
Social Security contributions are paid by employees, employers, and the government.
In Sharjah and Abu Dhabi, employees and employers only pay social security contributions. The eligibility requirements and minimum pension amounts vary.
Dependents/Survivors Benefits
In the United Arab Emirates, the law mandates the provision of monthly pensions for the surviving beneficiaries after the death of the employee insured under the pensions scheme. The surviving beneficiaries include parents, spouses, children, and siblings. The pension amount is equal to the old-age or disability pension that the deceased employee was entitled to. It is distributed among eligible survivors. The survivors also receive a lump sum of AED 60,000 (United Arab Emirates dirhams) distributed among them under the Islamic Shari'a's inheritance provisions.
In case of death due to work-related injuries or occupational disease, the employee's survivors are eligible for a pension equal to 100% of the deceased's average salary. In addition, survivors are entitled to a lump-sum benefit equal to AED75,000, which is distributed among them under the provisions of inheritance in the Islamic Shari'a.
The Emirates of Sharjah and Abu Dhabi have different beneficiaries and benefit amounts.
Invalidity Benefits
The social security law in the United Arab Emirates covers benefits for termination of work due to total disability. There is no requirement of age or years of service to be fulfilled. The pension is calculated as the employee has completed 35 years of insurance coverage. The amount of the benefit is equal to 60% of the average salary in the last 5 years, plus 2% per year of contribution beyond 15 years until it reaches 100%. Private-sector employees' minimum pension amount can be 20% of the average salary in the last 4 years. Disability is assessed every 2 years.
The pension for death and disability due to a work incident in Sharjah is calculated as if the employee has completed 35 years of contributions. If the disability or death is not a result of work, the contribution period is calculated as 15 years. The pension is calculated monthly at the rate of 60% of the salary for the contribution periods calculated in the fund that reach 15 years and increased by 2% for each year exceeding this period, up to a maximum of 100%.
In case of an accident at work or occupational disease, the employer must cover employees' treatment expenses at government or private hospitals until they recover or their disability is proven. Employees are eligible to receive a pension based on the type and degree of disability. A lump sum of AED 75,000 (United Arab Emirates dirhams) is also paid to an employee diagnosed with a total permanent disability.