Pension opt-outs and re-enrolment in the United Arab Emirates
Reviewed by Mellow Editorial Team, HR & payroll content team
UAE pension law does not give expatriate employees a right to opt out of — or be enrolled in — a government pension scheme. The opt-out and re-enrolment framework applies exclusively to UAE and GCC nationals enrolled in the General Pension and Social Security Authority (GPSSA) scheme.
Who the GPSSA scheme covers
GPSSA covers UAE nationals and, by reciprocal GCC agreements, nationals of other Gulf Cooperation Council states working in the UAE. Expatriate employees are outside the scheme entirely; their post-employment protection comes from the end-of-service gratuity instead.
For nationals, enrolment is mandatory from the first day of employment. There is no opt-out right for the employee, and no discretion for the employer to withhold registration. If you hire a UAE or GCC national, registering them with GPSSA is a legal obligation, not an administrative option.
The employer registration process
When you hire a UAE or GCC national, the registration steps are:
1. Register your company with GPSSA if you have not done so already. You do this through the GPSSA online portal using your trade licence and establishment details.
2. Register the new employee within the deadline set by GPSSA (typically within the first month of employment — check the current portal guidance for the exact deadline, as administrative timelines can be updated).
3. Set up contribution deductions correctly in payroll. Both the employer and the employee contribute a percentage of the insurable wage; the exact rates are set by GPSSA and subject to revision, so confirm current figures directly with GPSSA or your registered payroll provider rather than relying on any single source.
4. Pay contributions monthly through the approved channel. Contributions must be remitted on time; late payment attracts penalties.
All salary payments for UAE and GCC nationals — as with all employees — must also flow through the Wage Protection System (WPS), so your WPS setup and GPSSA contribution schedule need to run in parallel.
Opt-outs: what the law actually says
There is no statutory mechanism for a UAE or GCC national to opt out of GPSSA coverage while in active private-sector employment. If an employee asks you whether they can leave the scheme to take a higher take-home salary, the honest answer is no. Attempting to pay a national "gross" and skip pension registration is a compliance breach, not a payroll arrangement.
The concept of opt-out that employers sometimes encounter in other jurisdictions — where employees can decline auto-enrolment — does not exist here in the same form. Registration is automatic and compulsory once the eligibility conditions are met.
Re-enrolment and returning employees
Re-enrolment becomes relevant in two practical situations:
Gap in contributions. If a national employee had a period of unpaid leave, a break in service, or a prior employer failed to register them correctly, there may be a contribution gap on their GPSSA record. You are not personally responsible for a previous employer's failure, but you should register the employee from the date they join you and flag any historic gaps to GPSSA directly. The employee may be able to purchase missing contribution periods — that is between them and GPSSA.
Re-hiring a former employee. If you re-hire a UAE or GCC national who previously worked for you or another employer and already has a GPSSA record, you register them afresh with your establishment for the new employment period. Their prior contribution history stays on their GPSSA account; your obligation is to contribute correctly from their new start date onward.
In both cases, the process is the same: notify GPSSA, set up deductions, pay on time.
End-of-service gratuity runs alongside pension for nationals
One point that causes confusion: UAE and GCC nationals enrolled in GPSSA are generally exempt from the end-of-service gratuity that applies to expatriates, because the pension scheme is considered their equivalent long-term benefit. Expatriates, who have no GPSSA access, accrue gratuity under Federal Decree-Law No. 33/2021 — 21 days' basic wage per year for the first five years of service and 30 days' per year after that, capped at two years' total pay.
Running the two systems in parallel for a mixed workforce — nationals on GPSSA, expatriates on gratuity accrual — is the standard structure for any UAE private-sector employer. Understanding which rules apply to which employee type is the first step to getting payroll compliance right. If you want to see how this split can be managed across a distributed team, how Mellow runs payroll across six countries covers the operational side in more detail.
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