Gratuity: UAE authority clarifies Shourak benefit with job switch in six months from end-of-service date

Abu Dhabi: Insured Emirati members under the umbrella of the General Pension and Social Security Authority (GPSSA) who decide to take advantage of ‘Shourak’, must ensure they join their new entity within a time-frame of ‘six months’ from their end-of-service date.

As the name suggests, ‘Shourak’ (otherwise known as ‘preference’ in English), has been introduced to empower Emiratis to take a decision “not to disburse their end-of-service benefits” when signing their end-of-service agreement with their previous entity. They must also ensure that they join their new employer within a time-frame of six months in order to benefit from ‘Shourak’.

Additionally, when joining a new entity, insured GPSSA members must make sure that their end-of-service benefits are merged within a period of one month. This suggested choice results in more sustainable insurance returns for themselves and their families, while benefiting from a secure pension scheme.

It is important to note that the ‘Shourak’ procedures do not apply to employment years prior to July 1, 2023, which is when the project will take effect as part of a performance agreement inaugurated last year for federal and government authorities; meaning any previous employment years prior to that date ‘will not’ be merged without a charge, since they are “not” covered by ‘Shourak’.

‘Shourak’ only covers insured members under GPSSA’s umbrella who are willing to transfer their end-of-service gratuity from one employer to the other, regardless of whether they are employed in a government or private sector. ‘Shourak’ does not “apply to” or “cover” insured Emiratis under “other” pension funds, even if regulated by the provisions of the UAE Federal Pension Law, nor does it “apply” to individuals transferring from another UAE-based pension fund to the GPSSA, said that however, if the insured person wishes to transfer his/her end-of-service gratuity, it is up to the human resources regulations in both previous and subsequent entities to “agree to merge the end-of-service gratuity” and if agreed, the “new” employer/entity in which the insured is transferred to bears the difference in cost incurred in the merging process.

Also, ‘Shourak’ does not cover pensioners or individuals about to retire, since the whole point behind the programme is to support insured Emiratis in merging their previous and subsequent employment years in order to receive a secure and sustainable pension by the time they are ready to retire. Additionally, ‘Shourak’ does not cover individuals with a service period of less than one year, due to the fact that this period of time does not entitle insured persons to receive an end-of-service benefit in the first place.