Emirati employees are being encouraged to embark on longer careers in return for more insurance benefits for themselves and their families.
The General Pension and Social Security Authority said on Monday that citizens who worked for 20 years would receive a pension at a rate of 70 per cent of the average contribution from their monthly salary, state news agency Wam reported.
Those who continue working will receive "an increase in pension by 2 per cent for each additional year spent working", the authority said.
Proactive financial planning
The authority administers pensions to citizens in all of the emirates, excluding those working in the public and private sectors in Abu Dhabi and the public sector in Sharjah.
The announcement is part of its Get Ready – Proactive Financial Planning campaign, which aims to emphasise the importance of preparing for retirement.
Pensions are granted to public sector employees based on the average contribution from their monthly salary in the final three years of service. The period is five years for private-sector employees.
The insurance scheme covers ageing, disability, death, work and occupational illnesses, and contribution is obligatory for those who are eligible.
That included those who have completed 20 years of service and are at least 50 years old.
If an employee's service period is shorter, their pension is calculated based on the total contribution period.
The authority also said Emiratis who worked for more than 25 years in the government sector would have the right to combine their pension and salary once they returned to work or took a new job, Wam reported.
Women who retire after 25 years of service may obtain the maximum retirement pension at 100 per cent of the average contribution salary, and purchase an additional 10 years.
Men who retire after 30 years will receive the full pension benefit and can purchase an additional five years of legal service.
Employees who complete 35 years of service will be eligible for 100 per cent of their pension and a bonus equal to a salary contribution of three months for each additional year served.
The authority said it was encouraging Emiratis to work for more than 20 years to avoid the cost of purchasing additional service years.
Working for 25 years allows employees to receive a pension and salary if they retire and return to work.
It said the law allowed the insured to combine the pension from the authority and the salary from their new job.
If an employee has not completed 20 years of service, they will receive their end-of-service benefits.
But if an employee resigns voluntarily before they retire, they will only be eligible for end-of-service benefits if they have worked for 19 years and 11 months.
Top 10 global cities for retirement – in pictures
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Tokyo ranked as the best global city to retire in a new retirement index compiled by Veolar. Ryo Yoshitake/ Unsplash -
Wellington, New Zealand, was ranked as the second best global city to retire. Leyvaine Davids/ Unsplash -
Singapore ranked third and scored well in the categories of legacy management and quality of public transport. Kirill Petropavlov/ Unsplash -
Paris is the fourth best city to retire and scored well in the liveability sub-index, driven by its museums and restaurants. Leonard Cotte/ Unsplash -
Vienna ranked fifth globally for offering the best retirement living standards for senior people. Jacek Dylag/ Unsplash -
Zurich, in sixth position, ranked high for safety and quality of health care. Henrique Ferreira/ Unsplash -
Copenhagen was ranked seventh, driven by its safety, mobility and accessibility to health care. Nick Karvounis/ Unsplash -
Amsterdam is the eighth best city to retire globally, Veolar said. Adrien Olichon/ Unsplash -
Osaka in Japan placed ninth, earning high scores in the quality and accessibility of health care and health longevity sub-indices. Ramon Kagie/ Unsplash -
Lausanne in Switzerland is the 10th best city globally in terms of retirement living standards, the index showed. Mark de Jong/ Unsplash
