Mohammed Qasim Al Ali, Group Chief Executive Officer of National Bonds, commented: “We are confident that the recently approved optional system for end-of-service gratuities by the UAE Government will increase the attractiveness in the UAE’s labor market and will strengthen job security. Furthermore, it will empower individuals and corporations to invest in their future and support corporates with employee retention strategies.”
The UAE Government approved a new optional system for end-of-service gratuities for employees in the private sector and free zones to participate in it, and is considered optional for employers. The new system will include establishing private sector investments and savings funds, through which employees’ end of service benefits are saved and invested in various investment options.
The new law also aims to safeguard workers’ savings, which constitute the end of service gratuities, and to ensure that they are safely invested in order to guarantee their rights and to achieve the stability of their families. In addition, government sector’s employees are entitled to join the system, for savings and investment purposes. It is anticipated that billions of untapped end-of-service benefits will be invested into the local economy, fostering a positive impact on the sustainability of returns and supporting growth and stability in the UAE market.
Mohammed Qasim Al Ali, Group Chief Executive Officer of National Bonds, said: “These decisions align with a series of strategic initiatives designed to enhance the country’s overall appeal across various sectors and attract talents. They also complement our efforts at National Bonds, including the launch of ‘Golden Pension Plan’, that aims to enhance employees’ end-of-service benefits in both government and private sectors. This comes in line with our strategic approach of achieving financial prosperity and ensuring a secure future for both UAE citizens and residents by offering optimal and sustainable solutions and programs.”
Its noteworthy to mention that 82% of employees in the UAE are open to employers investing their end-of-service benefits, based on the outcomes of the 12th edition of National Bonds Savings Index, an annual survey on the saving behavior in the UAE, are published with an aim to spread and reinforce a savings-oriented mindset while tailoring National Bonds’ programs and schemes to align with people’s aspirations, ultimately enhancing their financial security.