Abu Dhabi: Private sector entities that do not pay monthly contributions or provide incorrect data for their Emirati employees risk incurring additional penalties and, under certain conditions, imprisonment, as per the federal pension and social security law.
The fresh warning came today from the General Pension and Social Security Authority (GPSSA), which is running a campaign to educate insured Emiratis and the entities in which they are employed about an insured’s rights and duties in accordance to the NAFIS programme for Emiratisation.
GPSSA said charging an insured person with a percentage greater than the due contribution percentage or failing to pay expenses altogether results in a fine of D5,000 for each insured person. A court ruling is immediately taken to oblige entities to return excess amounts to their insured employees.
“Employers are fined for every Emirati employee not registered with the GPSSA and bear the responsibility of contributing on his or her behalf retroactively and paying the due contributions as per the employee’s start date,” GPSSA added.
According to the pension and social security federal law, salary contributions are due at the beginning of each month and may be extended until the 15th of the month. The provisions of Article 13 of the law state that monthly pension contributions are not refundable. Therefore, any delay in paying contributions beyond the specified dates results in mandating the company or entity’s owner to pay an additional amount at the rate of 0.1 per cent of the contributions due for each delayed day and without the need to send a warning, as per the provisions of Article 14.
An additional 10 per cent is charged from the value of due contributions on entities that pay contribution amounts based on an incorrect salary to avoid paying contributions at a higher rate or to those who fail to pay due contributions for some or all of their employees.
Moreover, employers risk imprisonment and a fine of not more than Dh5,000 for each employee if the entity sends incorrect data or refrains from providing information on all practices that are considered illegal.