The General Pension and Social Security Authority UAE declared today that pension grants made payment monthly to the management on behalf of the certified by a unit or corporation is computed as per the contribution salary of the individuals.
“The pension and end-of-service compensation, made payment at the ending of the occupation, are depending on the same wage, then pension authority stated.”
Mohamed Saqer Al Hammadi, Head of Pension Operations at GPSSA, defined that this is crucial for certified people to understand more about the grant wage, which demonstrates the worth of the contributions made the payment by the insurer or their unit to the GPSSA each month, and the pension or the end-of-service compensation.
“The insured should know the difference between the overall wage, the contribution salary, and the moderate contribution wage hence they have understood the pension calculation salary or the end-of-service compensation, which they would get once their employment services come to the finish point,”
Al Hammadi stated – “The overall wage is all that the guaranteed receives at the end of every month from their employer, while the components of the contribution wage in the government sector are; the basic wage moreover to the monthly budgets and payments set according to the pension law, comprising the cost of living budget, kids budget, social budget, and housing budget, with an around of AED300,000; whereas in the private sector, this comprises everything mentioned in the occupation contract, with the highest limitation of AED50,000.”
The moderate contribution wage is computed in the government sector depending on the salaries of the contributor in their previous three years of work split by thirty-six months. Although, in the private sector, the sum of the previous five years is split by sixty months or the contribution tenure on both terms if the tenure is less.
Al Hammadi clarified that the pension is computed depending on the moderate grant wage reproduced by percentages, connected to the service years. “Fifteen years of service provides the guaranteed 60% of the moderate grant wage as a pension, while twenty years of service provides the guaranteed 70%. This percentage enhances by 2% of every extra year expended by the certified after twenty years of service to get the highest pension, which is 100% after finishing 35 years of service.”
If a certified in the administration industry has cone twenty years of service and is qualified for a pension, they will get 70% of the moderate grant compensation.
In case an insured is allowed an end-of-service compensation, this is computed depending on the moderate contribution salary. The gratuity is computed at the score of the month and a half moderate computation wage for every year of service from one to five years, an average computation wage of 2 months for every year of service from 5 to 10 years, and a 3-month average computation wage for each year of service surpassing ten years.
In case an insured has done 13 years of service, the end-of-service compensation for the first 5 years would be computed as follows – AED 15,000 x 1.5 months x 5 years = AED 112,500. In the following 5 years this would be AED 15,000 x 2 months x 5 years = AED 150,000. The remaining 3 years would be computed as AED 15,000 x 3 months x 3 years – AED 135,000. In this term, the retirement worth for 13 years amounts to AED 397,5000.
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