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April 5, 2024

Dubai amends DIFC Employment Law, requiring employer 'top-up' payments

  • The Ruler of Dubai has announced the enactment of Dubai International Financial Centre Amendment Law (DIFC Law No. 1 of 2024) to amend the existing DIFC Employment Law.
  • The amendment requires DIFC employers to make "top-up" payments into a Qualifying Scheme for their Gulf Cooperation Council (GCC) national employees in specific scenarios and includes a provision when payments cannot be made to a Qualifying Scheme due to sanctions.
  • Companies in the DIFC should review the eligibility of their GCC national employees and take necessary steps to comply with the requirements under the amendments.

Executive summary

On 1 March 2024, His Highness Mohammed bin Rashid Al Maktoum, Vice-President, Prime Minister and Ruler of Dubai, enacted Dubai International Financial Centre Amendment Law (DIFC Law No. 1 of 2024 or Amendment Law), which came into force on 8 March 2024.

The amendments to the existing DIFC Employment Law require DIFC employers to make "top-up" payments into a Qualifying Scheme (such as the DIFC Employee Workplace Savings or DEWS scheme) for their GCC national employees (in addition to making their General Pension & Social Security Authority (GPSSA) contributions) if the employees' GPSSA contributions are lower than they would have received as monthly end-of-service contributions under the DIFC Employment Law if they were not GCC nationals.

Detailed discussion


According to DIFC Employment Amendment Law No. 4 of 2020 (2020 Law), the employer shall, on a monthly basis for the benefit of each employee who is not an exempted employee, pay to a Qualifying Scheme an amount equal to at least their core benefits. Core benefits shall be calculated at 5.83% of employees' monthly basic wage for the first five years of their service and 8.33% for each additional year of services. Schedule 1 of the 2020 Law considers an employee registered with the GPSSA as exempted from the Qualifying Scheme. Subsequently, DIFC Law No 1 of 2024 was issued to further provide amendments to the 2020 Law.

Highlights of the Amendment Law

Further, the Amendment Law provides that if an employee is a United Arab Emirates (UAE) national or a GCC national and his/her pension contribution to the GPSSA is less than the amount of core benefits due to him/her if they were not a UAE national or a GCC national, the employer would be required to calculate the difference and make top-up payments into a Qualifying Scheme. Note, however, that such monthly top-up contribution is only required if it is equal to or greater than AED1 1,000.

Under the Amendment Law, "top-up contribution" is defined as the positive difference between the core benefits that would have been payable to the employee according to DEWS Qualifying Scheme (i.e., 5.83% of the employees' monthly basic wage for the first five years, and 8.33% for each additional year of service) and the employee's GPSSA pension contribution for the month.

Moreover, a provision has been added prohibiting a Qualifying Scheme from accepting contributions from an employer or, in the case of an employee, as a result of sanctions prohibitions. If an employer or employee is subject to sanctions that prohibit a Qualifying Scheme or its service providers from receiving end-of-service contributions on behalf of an employee, the employer's obligation to make such a contribution monthly to a Qualifying Scheme is suspended. This obligation is replaced with a requirement that the employer accrue such benefits on behalf of the relevant employee until the sanctions-related prohibition falls away or the employment relationship is terminated, whichever is earlier.

Noncompliance with the Amendment Law could expose employers to penalties up to US$2,000 per employee, according to Schedule 2 — Contraventions and Fines of the Amendment Law.


Companies in the DIFC should review the eligibility of their GCC national employees and take necessary steps for compliance with the Amendment Law.

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1 AED is the abbreviation for the Emirati Dirham.

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Contact Information

For additional information concerning this Alert, please contact:

EY Consulting LLC, Dubai

Ernst & Young LLP (United States), Middle East Tax Desk, New York

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor

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