The end-of-service savings scheme

What the law says

Article 51(8) of the labour law says the Cabinet “may … approve other alternative systems for the end-of-service gratuity system”, and that its decision sets the conditions and how contributions work.

The savings scheme is that alternative. It’s set out in Cabinet Resolution No. 96 of 2023. The government’s official guidance, quoted below, matches the resolution.

How the scheme works

According to the official guidance:

• It’s voluntary for employers. The government calls it “the voluntary alternative end-of-service benefits system – the Savings Scheme”.
• It “applies to employers and employees in the private sector and free zones” (Resolution 96, Article 3).
• Employers “may choose to enrol all employees, specific groups, or selected professional categories” (Article 5(2)).
• For full-time employees, the employer pays in 5.83% of the monthly basic salary until you complete 5 years of service, and 8.33% after that (Article 6(1)). Service counts from the day you started with the employer, not the day you joined the scheme (Article 6(2)).

Gratuity you earned before you joined

You don’t lose it. The guidance says that once employees are enrolled, the employer “must calculate and settle any gratuity accrued prior to enrolment, in accordance with the law”.

That earlier gratuity is worked out “on the value of the beneficiary basic wage at the time of participation in the alternative scheme”, and paid “upon termination of the work relationship” (Resolution 96, Article 5(3)). So it uses your basic salary on the day you joined, and you get it when your job ends. Our calculator doesn’t work out this part yet.

Getting your money

The guidance says you’re entitled to “all basic subscription amounts paid by the employer and any returns resulting from it during the subscription period, within 14 days after the termination of employment”.

It also says that members “may choose to keep their funds invested in the scheme or withdraw them at any time without restriction”.