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DIFC employment law end of service gratuity

difc employment law end of service gratuity

DIFC employment law end of service gratuity (EOSG) has undergone significant changes for expatriate workers.

These changes are ongoing and are vital for employers and employees within the DIFC jurisdiction.

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DIFC employment law end of service gratuity

The amendments to the DIFC Employment Law have brought about several key features and implications:

  • Monthly Contributions: Employers are now required to contribute to a Qualifying Scheme on a monthly basis, based on an employee’s basic salary and length of service.
  • Protection Against Insolvency: Contributions made to the Qualifying Scheme are ring-fenced, reducing risks for employees in case of employer insolvency.
  • Employee Contributions: Employees can also make personal contributions to the Qualifying Scheme, enhancing their retirement savings.
  • Fines for Non-Compliance: Employers failing to comply with the new regulations may face fines of USD 2,000 per affected employee.
  • Accrued EOSG Treatment: Employers have ongoing options regarding accrued EOSG, including transferring it to a Qualifying Scheme with or without employee consent.
  • Exempted Employees: Certain categories of employees remain exempt from mandatory registration in the Qualifying Scheme.
  • New Starters and Probation: New employees must be registered within 2 months, with exceptions for those on probation.
  • What Constitutes a Qualifying Scheme: Criteria for Qualifying Schemes include regulatory compliance, monthly employer contributions, and oversight mechanisms.

DIFC grauity law Services

At Al Mulla Lawyers, we provide comprehensive services tailored to the DIFC employment law end of service gratuity. Our services include:

  • Legal Consultation: Expert legal advice on understanding and implementing the amended DIFC Employment Law regarding EOSG.
  • Policy Review and Updates: Assisting employers in reviewing and updating employment policies to ensure compliance with the new regulations.
  • Employee Education: Conducting workshops and training sessions for employees to understand their rights and options under the Qualifying Scheme.
  • Accrued EOSG Management: Guidance on the treatment of accrued EOSG and assistance in choosing the appropriate option (with or without employee consent) for transferring it to a Qualifying Scheme.
  • Registration and Compliance: Facilitating the registration of employers and employees into Qualifying Schemes, ensuring full compliance with regulatory requirements.
  • Dispute Resolution: Handling disputes related to EOSG, non-compliance issues, and representing clients in legal proceedings when necessary.
  • Continuous Updates: Keeping clients informed about any further developments or amendments to the DIFC Employment Law related to EOSG.

Our goal is to provide efficient and effective legal solutions that help businesses and employees navigate the complexities of the new DIFC Employment Law landscape regarding EOSG.

FAQs about DIFC new gratuity law

In the DIFC, end of service gratuity has been replaced by mandatory contributions to a Qualifying Scheme, such as DEWS, based on the employee's basic salary and service duration.
Yes, end of service gratuity is mandatory for expatriate employees in the UAE who have completed at least one year of service.
Yes, participation in DEWS or another Qualifying Scheme is mandatory for all DIFC-based companies.
No specific new gratuity law for 2024 has been announced. The most recent change is the implementation of the DEWS system in DIFC.

Conclusion about DIFC employment law end of service gratuity:

The replacement of End of Service Gratuity with a Qualifying Scheme under the amended DIFC Employment Law represents an ongoing shift in retirement benefits for expatriate workers.

Employers need to continually understand their obligations regarding monthly contributions and treatment of accrued EOSG, while employees should be continually aware of their rights and options for personal contributions.

Adherence to these ongoing regulations is vital to avoid penalties and ensure a smooth transition to the updated employment landscape within the DIFC.

Facing a legal crossroads? Trust Al Mulla Lawyers to guide you through. Schedule a consultation now and let’s find the best path forward.

Read about DIFC employment law termination and DIFC courts employment law Services. Also, learn about DIFC employment lawyers services and law firms in DIFC UAE.

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