Closing the gender gap in UAE end of service benefits

Why is there a gender gap in UAE end of service benefits?

The statutory end of service benefit is built from two numbers: final basic salary and length of service. It turns differences in either of those metrics into larger differences at exit. Careers that include unpaid leave or slower progression around family feel that effect most. Whilst the formula is the same for everyone, and fathers and other carers who take unpaid leave or reduced hours lose out in exactly the same way, women are simply more likely, today, to be the ones taking that time.

The UAE's alternative end of service benefits scheme, an employee savings scheme that works much like a workplace pension, changes the starting point. Contributions are paid month by month into a funded scheme, which removes the final-salary effect, creates a record that can be measured, and gives employers practical levers to close the gap. Markets with mature workplace savings systems show which levers work.

How does the end of service gratuity formula treat career breaks and pay gaps?

The statutory benefit pays 21 days of final basic salary for each of the first five years of service and 30 days for each year after that. Two features of that design matter here. The whole career is valued at the last basic salary, so a pay gap that opens late is applied to every year worked. And days of unpaid leave are not counted as service, while paid maternity leave is.

Put together, a modest difference in pay and a period of unpaid leave, for example, after the birth of a child, can become a noticeably larger difference at exit. In one illustrative case, a 10 per cent gap in final basic salary and six months of unpaid leave across a ten-year career leave a 15 per cent gap in the end of service payment. Here is how that works.

Nothing in the formula is discriminatory. It simply rewards long, uninterrupted careers that peak late, and not every career follows that path.

What are other countries doing about the gender pensions gap?

Markets with mature workplace savings systems have stopped treating the gender gap as a pay issue alone, and their responses are encouraging.

Australia now pays superannuation on government-funded paid parental leave, so time spent caring for a new child no longer means a pause in retirement savings. The UK publishes official gender pensions gap statistics alongside employer pay gap reporting, so the issue is measured rather than assumed. Ireland launched its My Future Fund auto-enrolment scheme in January 2026 and extended gender pay gap reporting to employers with 50 or more staff. Across the EU, the Pay Transparency Directive requires larger employers to report pay gaps and act on any unexplained gap of 5% or more.

Do workplace savings schemes close the gender gap?

The results point the same way. When the UK introduced automatic enrolment in 2012, men were more likely than women to be saving in a workplace pension. By 2018, private sector participation stood at 85% for both. In Australia, women's share of total superannuation assets has risen from an estimated 23% in 1996 to 43.9% in 2024.

The lesson is consistent. Funded schemes quickly close the gap in who is saving, and the gap in how much is saved narrows where schemes are designed for it. In the UK, the gap is wider for people holding only defined contribution pensions than for those in defined benefit schemes, a reminder that design, not structure alone, makes the difference.

What does UAE law say about equal pay and end of service benefits?

The UAE has given employers a strong foundation by making equal pay a legal requirement. Article 4 of Federal Decree-Law No. 33 of 2021 requires women to receive the same wage as men for the same work or work of equal value. The country rose from 74th to 69th in the World Economic Forum's Global Gender Gap Report 2025 and leads the MENA region.

Equal pay for equal work addresses one input. It does not address time out of the workforce, reduced hours, or the final-salary leverage described above, and those are where EOSB outcomes diverge.

How does the alternative end of service benefits scheme help?

Cabinet Resolution No. 96 of 2023 introduced the voluntary alternative end of service benefits scheme. Employers pay 5.83% of monthly basic salary for members with under five years' service and 8.33% from five years, and employees may add voluntary contributions. Statutory EOSB stops accruing from the date an employer joins, and amounts already accrued remain due.

That shift works in employees' favour. Contributions are paid each month on that month's basic salary, so there is no final-salary effect. Every contribution is recorded, so the gap can be seen and measured while people are still employed.

How can UAE employers close the gender gap in end of service benefits?

Employers can close the gap in four practical ways: measure it, show members the effect of leave before they take it, keep contributions going through care, and prompt a review when people return.

Under the statutory gratuity the gap stayed invisible until someone left. Moving to a regulated savings scheme introduces technology to a process that has mostly run on spreadsheets, and that creates the data needed to act while it still matters.

The first step is measurement. Monthly contribution records let an employer review end of service balances and contribution continuity by gender.

The second is foresight: a member considering unpaid leave or reduced hours can see the effect on their balance before deciding, not years later.

The third is continuing contributions through care. Employers could choose to keep paying during unpaid parental leave or a part-time return through employer enhanced contributions. Cabinet Resolution No. 96 of 2023 neither expressly permits nor prohibits the use of the Savings Scheme to allow employers to facilitate contractually promised employer contributions offered over and above the basic subscription. The approach to allow employer enhanced contributions is effective within DIFC qualified schemes.

Finally, a return from leave is a natural moment to proactively prompt a review of voluntary contributions, so members can pick up where they left off.

The impact of technology

Once the data is structured, AI capabilities become practical too: flagging contribution gaps across a workforce or answering a member's question about how a break affects their balance in plain language. None of this replaces policy. It makes the policy measurable.

Cohlay is a workplace savings platform for the UAE, providing the employer, administration and member layer behind alternative end of service schemes, and this is the kind of visibility it is designed to give.