What is an end-of-service benefit (EOSB)?
An end-of-service benefit, commonly referred to as gratuity, is the final payment an employer makes to an employee when their employment contract ends. It's typically paid as a lump sum after completing at least one year of continuous service.
What is the Alternative End-of-Service Benefits Savings Scheme?
The Alternative End-of-Service Benefits Savings Scheme is a UAE government initiative, implemented under Cabinet Resolution No. (96) of 2023, offering an alternative to the standard end-of-service gratuity system set out in Federal Decree-Law No. (33) of 2021 on Labour Relations and its Executive Regulations. It is a Ministry of Human Resources and Emiratisation (MOHRE) initiative, approved by the Securities and Commodities Authority (SCA).
Under the scheme, participating employers choose which employees to enroll and make a monthly contribution (the Basic Subscription) to an approved investment fund on behalf of each enrolled employee. Instead of a lump-sum gratuity, the employee receives their Basic Subscription balance plus any investment returns at the end of their service — this is legally recognized as their end-of-service benefit.