Decree No. (46) of 2022
Concerning the End-of-Service Gratuity
Management Schemes of
Employees in the Emirate of Dubai[1]
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We, Mohammed bin Rashid Al Maktoum, Ruler of
Dubai,
After perusal of:
Federal Law No. (7) of 1999 Issuing the Pensions
and Social Security Law and its amendments;
Law No. (5) of 1995 Establishing the Department of
Finance;
Law No. (3) of 2003 Establishing the Executive
Council of the Emirate of Dubai;
Law No. (32) of 2008 Establishing the Government
of Dubai Legal Affairs Department;
Law No. (31) of 2009 Establishing the Dubai
Government Human Resources Department and its amendments;
Law No. (1) of 2016 Concerning the Financial
Regulations of the Government of Dubai, and its Implementing Bylaw and its
amendments;
Law No. (13) of 2016 Concerning the Judicial
Authorities in the Emirate of Dubai and its amendments;
Law No. (8) of 2018 Concerning Management of the
Government of Dubai Human Resources;
Law No. (5) of 2021 Concerning the Dubai
International Financial Centre;
Decree No. (7) of 2020 Determining the Government
Entities Governed by the Government of Dubai Human Resources Management Law;
Executive Council Resolution No. (6) of 2020
Approving the Financial Benefits of the Government of Dubai Employees; and
The human resources legislation
applicable to the Government
Entities and other entities Governed by the above-mentioned Law No. (8) of 2018
Concerning Management of the Government of Dubai Human Resources,
Do hereby issue this Decree.
The
following words and expressions, wherever mentioned in this Decree, will have
the meaning indicated opposite each of them unless the context implies
otherwise:
|
UAE: |
The United Arab Emirates. |
|
Emirate: |
The Emirate of Dubai. |
|
Ruler: |
His Highness the Ruler of Dubai. |
|
Government: |
The Government of Dubai. |
|
Executive Council: |
The Executive Council of the Emirate of Dubai. |
|
DIFC: |
The Dubai International Financial Centre. |
|
DGHR: |
The Dubai Government Human Resources Department. |
|
Department: |
Any of the entities to which the provisions hereof apply, as listed in Article (3) of this Decree. |
|
Employee: |
A non-UAE National civilian employee who occupies a budgeted post in a
Department, including any non-UAE National Member
of a Judicial Authority or any employee who is issued with an initial
approval by the Ruler to be granted the UAE nationality and who holds a valid
UAE passport. |
|
UAE National: |
Any person holding the UAE nationality. |
|
Scheme: |
The scheme adopted by the DIFC for the management and investment of
the Contributions and end-of-service gratuities of the DIFC Employees, or any other saving scheme for
Employees to be adopted by the Executive Council upon the recommendation of
the Department of Finance. |
|
Contribution: |
An amount that is owed
to an Employee on account of his end-of-service gratuity, as
calculated in accordance with the human resources legislation applicable to his Department;
and that is transferred to a Contracted Entity as a lump sum or monthly percentage of salary in return for enrolment in a Scheme. |
|
Enrolment
Agreement: |
An agreement concluded between a Department and a
Contracted Entity under which the process
for enrolment in a
Scheme is determined. |
|
Contracted Entity: |
An establishment operating in the Emirate, including in a Special Development Zone or in a free zone, such the DIFC,
to manage and operate a Scheme and to invest Contributions and
end-of-service gratuities of Employees. |
|
Voluntary Enrolment: |
A voluntary enrolment of an Employee in a
Scheme in order to save part of his salary. This takes effect through the deduction by the Department of
a certain percentage of the Employee’s monthly Total Salary, which is determined by him, as a contribution to the Scheme. |
This
Decree aims to:
1.
contribute
to creating an attractive environment in the Emirate for persons with talent and specialised competencies and skills, and
enhancing the flexibility
of work environments within the entities to which the provisions of the Decree apply;
2.
enhance the social security of the Employees;
3.
enhance the leading role of the Government in
generating the highest possible profits for Employees through the optimum
investment of their end-of-service benefits;
4.
contribute
to using all resources to implement the Government’s initiatives aimed at achieving the employment stability and promoting the happiness of Employees; and
5.
promote
saving amongst Employees, and assist them in increasing and developing their financial
savings.
The provisions of this Decree apply to the Employees of:
1.
the
entities governed by the above-mentioned Law No. (8) of 2018;
2.
the
entities stated in the list attached hereto; and
3.
any
of the Government Entities or other entities to which the application of this
Decree is extended pursuant to a resolution issued in this respect by the
Chairman of the Executive Council.
For the purposes
of this Decree, the Department of Finance will have the duties and powers to:
1.
evaluate,
in coordination with the DGHR and other competent entities in the Emirate, the
impact of implementation of this Decree to verify the achievement of its
intended objectives; and submit the outcomes of this evaluation to the
Executive Council to take the necessary action in respect thereof;
2.
select
and evaluate the performance of Contracted Entities;
3.
recommend
to the Executive Council the approval of any saving Scheme other than the Scheme adopted by the DIFC;
4.
approve,
in coordination with the Government of Dubai Legal Affairs Department, the template
Enrolment Agreement and any
changes thereto;
5.
issue
instructions and guidelines stating the policies and procedures for
implementing Enrolment Agreements and the requirements of Schemes;
6.
supervise
the scope of investment of Contributions by Contracted Entities as per the terms of Enrolment
Agreements;
7.
prepare,
in coordination with the DGHR, periodic reports on the performance and work of
Contracted Entities; and submit the same to the Executive Council to take the necessary
action in respect thereof;
8.
determine
the scope and rules of investment
of Contributions within or outside of the Emirate, and ensure that a certain
percentage of these Contributions is invested within the local market of the
Emirate. This percentage will be determined by a resolution of the Chairman of
the Executive Council; and
9.
exercise
any other duties or powers conducive to the achievement of the objectives of this Decree,
as assigned to it by the Chairman of the Executive Council.
For the
purposes of this Decree, the DGHR will have the duties and powers to:
1.
raise
awareness of Employees on the
importance of Schemes through organising introductory workshops for them in coordination with
the concerned entities;
2.
provide
Departments or Contracted Entities, upon request and in accordance with the applicable legislation, with
the data and information required for conducting financial studies;
3.
measure
the level of Employee satisfaction with the Schemes and services provided by Contracted
Entities, and submit the
relevant proposals and recommendations to the Executive Council to take the
necessary action in respect thereof; and
4.
exercise
any other duties or powers conducive to the achievement of the objectives of this Decree,
as assigned to it by the Chairman of the Executive Council.
a.
A Department must enrol all its Employees in Schemes
in accordance with the provisions of this Decree, the resolutions issued in
pursuance hereof, and the Enrolment Agreement.
b.
Mandatory enrolment in a Scheme will terminate in either of the following cases:
1.
upon
the end of the Employee’s service
with the Department; or
2.
where
the Employee obtains the UAE nationality.
c.
The
Contributions of an Employee, who is appointed
by a Department after the effective date of this Decree, will become
payable as from the month
in which the Employee joins the employment of the Department. The Contributions of Employees who are working with the Department on
the date on which this Decree comes into force will become payable as from the
month in which they are registered in the Scheme.
a.
A Department must transfer
Contributions to the relevant
Contracted Entity. These Contributions will be
calculated as per the end-of-service gratuity calculation method stipulated in
the human resources legislation applicable to the Department.
b.
For the
purpose of calculating Contributions, a part of a month will be rounded up to a
full month unless the human resources legislation applicable to the Department stipulates otherwise.
c.
Contributions will be transferred to the Contracted Entity in UAE dirhams.
a.
An Employee will be enrolled in a Scheme subject to the following rules:
1.
The scheme must be approved by the Executive Council.
2.
The
Enrolment Agreement must be consistent
with the provisions of this Decree.
3.
Any other rules prescribed by the relevant resolutions issued
by the Chairman of the Executive Council must be complied with.
b.
The Chairman
of the Executive Council will, upon the recommendation of the Department of
Finance, issue a resolution setting out the phases of implementation of Schemes and registration of Employees therein.
a.
Enrolment
in a Scheme will be regulated
by an Enrolment Agreement concluded between
the Department and the Contracted Entity. This agreement must state:
1.
the obligations and rights of its parties;
2.
the
method of
calculating Contributions;
3.
the
methods and rules of
investing and managing Contributions;
4.
the
types of investment portfolios in which Contributions may be invested;
5.
the
method of transferring the amounts deducted from the monthly salaries
of Employees to the Contracted
Entity where they opt for Voluntary Enrolment;
6.
the
procedures and rules for disbursement of Contributions to an eligible Employee upon the
end of his service with the Department, and for
disbursement of any other
amounts transferred by the Department to the Contracted Entity on account of the end-of-service gratuity of that
Employee;
7.
the
rules and standards for maintaining the confidentiality of the data and information of Employees and for
protecting and exchanging these data and information in line with the legislation in force in the Emirate;
8.
the
term of the Enrolment Agreement; and
9.
any
other data considered by the Department, in coordination with the
Department of Finance, necessary to be included in the Enrolment Agreement.
b.
Without
prejudice to the provisions of this Decree and the human resources legislation applicable
to the Department for which an Employee works, the rights of the Employee and
the obligations of the Department and the Contracted Entity will be determined
by reference to the Enrolment
Agreement and the requirements prescribed by the Scheme.
c.
The Department of Finance may sign an
Enrolment Agreement on behalf of a Department.
In this case, the Department will enjoy all the rights arising from the agreement concluded with the Department
of Finance and will be liable for meeting all
obligations related to the implementation of that agreement.
Subject
to the provisions of Article (12) of this Decree, the following will apply to an Employee’s entitlement to Contributions:
1.
Upon the end of service of
the Employee with the Department, he will be entitled to receive the total Contributions transferred to the Contracted Entity. The Employee’s entitlement to Contributions will be subject to completing at least one (1) year
of actual service unless the human resources legislation
applicable to his Department prescribes another period for entitlement to the end-of-service gratuity.
2.
Without
prejudice to the provisions of Article (17) of this Decree, the Contributions
paid by a Department will constitute
fulfilment of its obligation to pay
the end-of-service gratuity prescribed by the human resources legislation
applicable to the Department. The total Contributions must be equal to the amount of the end-of-service
gratuity payable to the Employee at the end of his service.
3.
The
Contributions payable to the Employee will be disbursed, together with any Voluntary Enrolment Contributions and any profits payable to him, within no later than fourteen (14) days from the date on
which the Department notifies the Contracted Entity to disburse these amounts, or within any other time frame specified in the Enrolment
Agreement. Any losses incurred as a result of investing these Contributions and
any fees or taxes owed by the
Employee, if any, must be deducted
from the Contributions.
4.
The
Employee must, at the end of his service, receive the total Contributions owed to him under this Decree in the UAE dirhams. The Employee will not be
liable for any differences in the
rates of exchange from other
currencies if he is enrolled in a capital guaranteed portfolio. On
the other hand, if the Employee is enrolled in a low- to moderate- risk investment portfolio, he will be liable for the differences in exchange rates.
5.
The
Department may request the Contracted Entity to deduct from the Contributions
any amounts owed by the Employee to the Department, including any amounts transferred by mistake to
the Contracted Entity. In any
event, Contributions may not be
paid to the Employee unless
he first obtains a clearance
letter from the Department for which he was working at the end of his service.
6.
For the
purpose of calculating and transferring Contributions to the Contracted Entity,
a notice period will be deemed part of the period of service of the Employee. This period will not count
towards the period of service
of the Employee where he is exempt from observing the notice period pursuant
to the human resources legislation
applicable to the Department.
7.
The Department will recover Contributions from the Contracted Entity if the
Employee does not complete one (1) year of actual service with the Department unless the human resources legislation applicable
to the Department stipulates that the Employee becomes eligible for the
end-of-service gratuity upon completion of a different period.
A Department must:
1.
enrol
its Employees in a Scheme under an Enrolment
Agreement in accordance with this
Decree and the resolutions issued in pursuance hereof;
2.
bear the
costs of enrolling the Employees in the Scheme, if any, and not charge these
costs to the Employees, or deduct them from the Contributions, except for the
costs of any Voluntary Enrolment, which must be borne by the Employee;
3.
transfer
the Contributions to the Contracted Entity within the time frames prescribed in
the Enrolment Agreement;
4.
transfer,
on behalf of Employees, the Voluntary Enrolment Contributions to the
Contracted Entity as per the percentages agreed upon with the Employees;
5.
provide
the Department of Finance with a copy of the signed Enrolment Agreement if the
Department’s annual budget is included in the General Budget of the Government;
6.
not
amend the terms of the Enrolment Agreement without first obtaining the relevant
approvals from the Department of Finance and the Government of Dubai Legal
Affairs Department if the Department’s annual budget is included in the General
Budget of the Government;
7.
raise,
in coordination with the concerned entities, the awareness of the Employees on the
benefits of the Scheme and the risks of its various investment portfolios;
8.
subject
to the provisions of Article (12) of this Decree, prepare and calculate, before
disbursement of Contributions
to any Employee by the Contracted Entity, a final settlement of the
end-of-service gratuity payable to that Employee, upon the end of his service, in
accordance with the relevant human resources legislation applicable to the
Department; and
9.
fulfil
any other obligations determined pursuant to the relevant resolutions of the
Chairman of the Executive Council.
a.
Contributions
may be invested in capital guaranteed portfolios and
low- to moderate- risk investment portfolios.
b.
Where
the Contracted Entity invests Contributions in low- to moderate- risk
investment portfolios, an Employee will be entitled to the profits generated
from that investment and will be liable for the losses, fees, and taxes
incurred in respect thereof.
c.
Notwithstanding
the provisions of paragraph (b) of this Article, an Employee may opt for investing the Contributions transferred in his name to the Contracted Entity in
a capital guaranteed portfolio. In this case, the Employee will not be entitled to any profits generated from the investment in that portfolio and will not be liable for any losses, fees, or taxes resulting
from investing the Contributions by the Contracted Entity.
d.
In any event,
an Employee may change the investment portfolio in which he is enrolled in
accordance with the provisions of this Article to any other investment
portfolio. In that case, the period
of investment of Contributions in each portfolio must be
taken into consideration in
calculating the profits to which he is
entitled or the losses, fees, and taxes for which
he is liable.
e.
Employee
categories, minimum salaries, and types of investment portfolios in which the
automatic investment of Contributions under Schemes is allowed for each
category will be determined by a resolution issued by the Chairman of the Executive
Council upon the recommendation of the Department of Finance.
In
addition to the Contributions transferred by a Department to a Contracted
Entity under this Decree, an Employee who has completed at least one (1) year
of actual service with the Department, or any other term prescribed by the
human resources legislation of the Department for determining his eligibility
for the end-of-service gratuity, may voluntarily enrol in a Scheme, in which
case, a voluntary Enrolment Contribution will be deducted from his total
monthly salary. The method of investment of the Voluntary Enrolment Contributions
and the method of their disbursement will be determined as per the Scheme rules
adopted by the Contracted Entity.
a.
Except
in cases of bankruptcy of a Contracted Entity or failure by a Department to
transfer the Contributions to that entity, the Department will not be liable
for the payment of Contributions to the Employee upon the end of his service
with the Department. The Contracted Entity will be solely liable for payment of
the Contributions together with any profits generated from the investment of
these Contributions in accordance with the provisions of Article (12) hereof,
after deducting any amounts payable to the Department from these Contributions.
b.
The
Department will not be liable for any losses incurred as a result of investing Contributions
or Voluntary Enrolment Contributions in accordance with this Decree.
Where
the service of an Employee with a Department is terminated and he is reappointed
in another Department that is governed by the provisions of this Decree, his Contributions
for the period of service with the former Department may not, subject to the
Employee’s consent, be paid out to him, in which case he will continue to be
enrolled in the Scheme by his new Department based on his new salary. Accordingly,
for the purposes of calculating payable Contributions, his end-of-service
gratuity for each period of service will be calculated as per the
end-of-service gratuity calculation method prescribed by the human resources
legislation applicable to the Department for which he has worked during that
period.
Notwithstanding
the provisions of any other legislation and with the exception of the
Department's right to deduct any amounts owed to it by an Employee, no entity may recover any
debt from, or enforce any obligation against, Contributions by way of taking
possession, seizure, sale by public auction, acquisition, or any other legal
process, whether or not a definitive judgement in respect of such debt or
obligation has been rendered.
Subject
to the provisions of this Decree, a Department will pay the end-of-service
gratuity of an Employee in continuous service, for the period preceding his
enrolment in the Scheme, as per the end-of-service gratuity calculation method
stipulated in the legislation applicable to the Department.
Without
prejudice to the provisions of the above-mentioned Federal Law No. (7) of 1999,
a UAE National Employee may, upon his request, be voluntarily enrolled in a
Scheme, in which case, a Contribution will be deducted from his total monthly salary
to be saved and invested. That enrolment in the Scheme will be governed by the
same provisions and procedures stipulated in this Decree in respect of the Voluntary
Enrolment of Employees.
All
applications, claims, or disputes arising under this Decree will be determined
by a special tribunal to be formed pursuant to a resolution of the Ruler from
amongst experts and specialists in the legal and financial fields. The tribunal
formation resolution will provide for the method of selecting its members; its
functions and powers; and the legal effect, and method of enforcement, of its
awards and judgements; and for any other relevant matters.
The
Chairman of the Executive Council will issue the resolutions required for the
implementation of the provisions of this Decree.
Any
provision in any other legislation is hereby repealed to the extent that
it contradicts the provisions of this Decree.
This
Decree comes into force on 1 July 2022, and will be published in the Official
Gazette.
Mohammed bin Rashid Al Maktoum
Ruler
of Dubai
1.
the
Executive Office;
2.
the
Dubai Protocol Department;
3.
the
Government of Dubai Legal Affairs Department;
4.
the
General Secretariat of the Executive Council of the Emirate of Dubai;
5.
the
General Secretariat of the Supreme Legislation Committee in the Emirate of
Dubai;
6.
the
Judicial Council and its affiliates;
7.
the
Dubai Courts and its affiliates;
8.
the
Public Prosecution;
9.
the
Rental Disputes Settlement Centre in the Emirate of Dubai;
10. the Dubai Digital Authority and its affiliates;
11. the Security Industry Regulatory Agency;
12. the Dubai Airports Corporation;
13. the Dubai Air Navigation Services Corporation;
14. the Dubai Aviation Engineering Projects
Corporation;
15. the Dubai Aviation City Corporation;
16. the Mohammed bin Rashid Al Maktoum Library
Foundation;
17. the Dubai Academic Health Institution;
18. the Dubai Future Foundation;
19. the Hamdan bin Rashid Al Maktoum Foundation for
Distinguished Academic Performance;
20. the Dubai Economic Security Centre;
21. the Mohammed bin Rashid Space Centre;
22. the Dubai International Marine Club;
23. the Dubai Racing Club;
24. the Dubai Equestrian Club;
25. the Hamdan bin Mohammed Smart University;
26. the Mohammed bin Rashid School of Government;
27. the Imam Malik College for Sharia and Law;
28. the Rashid and Latifa Schools Establishment;
29. the Meydan City Corporation;
30. the Dubai Development Authority;
31. the Dubai World Trade Centre Authority;
32. the Dubai Integrated Economic Zones Authority;
33. the Jebel Ali Free Zone Authority;
34. the Dubai Multi Commodities Centre Authority;
35. the Dubai Healthcare City Authority; and
36. the International Humanitarian City Authority.
©2022 The Supreme Legislation
Committee in the Emirate of Dubai
[1]Every effort
has been made to produce an accurate and complete English version of this
legislation. However, for the purpose of its interpretation and application,
reference must be made to the original Arabic text. In case of conflict, the
Arabic text will prevail.