DIFC Employee Workplace Savings

The DIFC Employee Workplace Savings Plan, commonly known as DEWS, is a mandatory funded workplace savings scheme that replaced the traditional end-of-service gratuity model for employees working in the Dubai International Financial Centre (DIFC). Launched on 1 February 2020 under DIFC Employment Law Amendment Law No. 4 of 2020, DEWS marked one of the most significant labor and payroll reforms in the United Arab Emirates, modernizing end-of-service benefits with a professionally managed defined contribution plan aligned with global retirement savings standards.

DEWS is structured as a master trust domiciled in the DIFC and regulated by the Dubai Financial Services Authority (DFSA). It is the default Qualifying Scheme under DIFC employment regulations, replacing the previous lump-sum end-of-service gratuity (EOSG) payable to employees upon termination. The plan has since been adopted by the Government of Dubai as the mechanism behind its broader Savings Scheme for Government of Dubai employees, signaling a broader regional shift from traditional gratuity payouts toward funded workplace retirement savings.

For any company operating in the Dubai International Financial Centre, DEWS compliance is a core payroll and HR requirement that directly affects monthly salary processing, end-of-service planning, and overall employer obligations under DIFC employment law.

How the DEWS Plan Works

Under DEWS, DIFC-based employers make mandatory monthly contributions into a regulated, professionally managed savings account on behalf of each eligible employee. Instead of accruing a single lump-sum gratuity at the end of employment, contributions are invested and grow over time, with the accumulated balance paid out when the employee leaves service.

The DEWS framework is built around four independent service providers selected by the DIFC Authority:

• Master Trustee: Equiom Fiduciary Services (Middle East) Limited, the independent legal owner of contributions, safeguarding employee beneficial interests.
• Plan Administrator: Zurich Workplace Solutions, responsible for enrollment, contributions, investments, withdrawals, and member services.
• Investment Advisor: Mercer Financial Services Middle East Limited, providing investment oversight and managed fund portfolios.
• Technology Platform: Smart Pension, powering the digital onboarding and member experience.

Contributions are denominated in US dollars, but employers may also pay in UAE Dirhams using a fixed conversion rate of USD 1 to AED 3.675.

DEWS Contribution Rates

DEWS employer contribution rates broadly match the accrual levels under the previous end-of-service gratuity model, ensuring consistency in employee benefits while modernizing the funding structure.

The mandatory DEWS contribution rates are:

• Less than 5 years of service: 5.83 percent of the employee’s monthly basic salary
• 5 or more years of service: 8.33 percent of the employee’s monthly basic salary

Contributions are calculated on basic salary only, excluding allowances such as housing, transport, and utilities. Employers are not required to make contributions during an employee’s probation period, although many choose to do so as part of their reward strategy.

Employees are not required to contribute, but may make voluntary contributions through salary deduction to build personal long-term savings on top of the employer-funded core benefit. Voluntary contributions can be partially withdrawn up to twice per year, capped at 30 percent of the voluntary savings pot value, while core employer contributions remain locked until the employee leaves service or reaches age 65.

Who is Eligible for DEWS?

DEWS applies to most non-GCC expatriate employees working in the DIFC. The scheme is mandatory for:

• Full-time and part-time DIFC employees on standard employment contracts
• Expatriate employees of DIFC-registered companies, including branches of foreign firms

The following categories are exempt from mandatory DEWS enrollment:

• UAE and GCC nationals, who are covered by GPSSA pension contributions
• Short-term workers and employees on temporary contracts under defined thresholds
• Equity partners of DIFC firms
• Employees on secondment in the DIFC
• Employees working for UAE government authorities
• Employers with statutory obligations to make pension or retirement contributions elsewhere
• Employers offering a regulated defined benefit scheme that provides benefits in excess of DEWS Core Benefits

UAE and GCC nationals can still choose to opt into DEWS to make voluntary contributions for additional savings.

Qualifying Schemes and Certificate of Compliance

While DEWS is the default Qualifying Scheme, DIFC employers may also enroll employees in an alternative Qualifying Scheme that meets DIFC Authority (DIFCA) standards. Approved alternatives include schemes such as GO SAVER, administered by Sukoon Workplace Savings Solutions with trustee services from CSC Trustee Services and investment management by Franklin Templeton.

To use an alternative scheme, DIFC employers must apply to DIFCA for a Certificate of Compliance, demonstrating that the scheme satisfies the core requirements, including:

• Mandatory employer contributions of at least the DEWS Core Benefit rates (5.83 percent and 8.33 percent)
• Payment of benefits when an employee leaves service or reaches 65 years of age
• Professional management by a regulated administrator and trustee
• Compliance with DIFC Employment Law and DFSA regulations

How DEWS Affects Pre-2020 Gratuity Accruals

Employees who worked in the DIFC before 1 February 2020 retain all gratuity benefits accrued under the previous EOSG regime up to that date. Key transition rules include:

• Pre-DEWS gratuity is calculated based on the employee’s final basic salary at the date of termination
• Employers can choose to pay accrued pre-DEWS gratuity into DEWS or another Qualifying Scheme
• Additional gratuity accruals stopped from February 2020 onward, replaced entirely by DEWS contributions

This dual structure means DIFC employers must maintain accurate end-of-service liability records for legacy gratuity entitlements alongside ongoing DEWS contributions.

Why DEWS Matters for DIFC Employers and Employees

DEWS offers significant advantages over the traditional end-of-service gratuity model for both employers and employees.

For employers, DEWS provides:

• Predictable monthly cost based on current salary rather than final salary
• Transparency and control over end-of-service liabilities
• Reduced exposure to inflation and unfunded gratuity liabilities
• Easier budgeting and accurate accrual reporting
• A competitive employee benefit aligned with global retirement savings standards
• Stronger talent attraction and retention in the DIFC

For employees, DEWS delivers:

• A regulated, professionally managed savings plan with investment growth potential
• Protection from employer insolvency or financial instability
• Access to conventional and Shariah-compliant fund options
• Voluntary contributions to accelerate long-term savings goals
• Portability of accumulated balance when changing DIFC employers
• A digital, self-service experience through the Zurich Workplace Savings app

Common DEWS Compliance Challenges

Despite the maturity of the DEWS framework, DIFC employers often encounter recurring issues:

• Misclassifying basic salary versus total compensation for contribution calculations
• Errors in probation period handling, mid-month joiners, and leavers
• Confusion between mandatory employer contributions and voluntary employee contributions
• Currency conversion errors when paying in AED instead of USD
• Missing the cut-off for monthly DEWS contributions, leading to interest or compliance flags
• Maintaining accurate records of pre-2020 gratuity entitlements alongside DEWS accruals
• Coordinating DEWS with WPS, GPSSA, MOHRE Emiratization, and free zone payroll
• Onboarding new hires correctly in the Zurich administration portal
• Handling employees who move between DIFC entities, mainland, free zones, and ADGM

For multinational employers with mixed workforces across DIFC, ADGM, mainland UAE, and free zones, manual DEWS administration creates real exposure to errors, audit findings, and employee disputes.

How Mercans Simplifies DEWS Compliance

As a global leader in payroll technology and Employer of Record services, Mercans helps DIFC-registered employers automate DEWS contributions, end-of-service benefit accruals, and broader UAE payroll compliance through its proprietary HR Blizz payroll platform.

With deep expertise in DIFC Employment Law, DEWS regulations, GPSSA pension rules, WPS, Emiratization, and Federal Decree-Law No. 33 of 2021, Mercans delivers complete payroll automation for companies operating across the UAE. Employers in the DIFC rely on Mercans for:

• Automated calculation of DEWS contributions at the correct 5.83 percent or 8.33 percent tier
• Accurate basic salary classification aligned with DIFC Employment Law
• Real-time tracking of contributions, accruals, and end-of-service liabilities
• Integrated handling of pre-2020 gratuity entitlements and post-2020 DEWS balances
• USD and AED contribution support with built-in exchange rate management
• Synchronization with Zurich Workplace Solutions for monthly DEWS submissions
• Coordinated payroll across DIFC, ADGM, mainland UAE, and free zones such as JAFZA and DMCC
• Bilingual payslips and end-of-service letters in Arabic and English
• Compliance dashboards that flag DEWS gaps, eligibility changes, and reporting deadlines

Explore Mercans’ UAE payroll software at https://mercans.com/payroll-software/uae/ and the full UAE payroll service at https://mercans.com/global-payroll/united-arab-emirates/.

For the regulatory background on the DIFC end-of-service reform and how DEWS replaced the traditional gratuity regime, read Mercans’ statutory alert: Dubai Payroll Outsourcing Alert: New DIFC End-of-Service Gratuity Law. For a broader look at how DEWS interacts with WPS, MOHRE, and labor compliance across the UAE, see Mercans’ guide on Payroll Software in the UAE: Navigating Wage Protection and Labor Law Requirements.

Frequently Asked Questions About DEWS

What is the DIFC Employee Workplace Savings (DEWS) Plan?

DEWS is a mandatory funded workplace savings plan that replaced the traditional end-of-service gratuity for employees working in the Dubai International Financial Centre. Launched in February 2020 under DIFC Employment Law Amendment Law No. 4 of 2020, it requires DIFC employers to make monthly contributions into a professionally managed defined contribution scheme regulated by the DFSA.

Who is eligible for DEWS?

DEWS applies to most non-GCC expatriate employees working for DIFC-registered companies. UAE and GCC nationals are exempt since they are covered by GPSSA, but they may opt in to make voluntary contributions. Short-term workers, equity partners, and seconded employees are typically excluded from mandatory enrollment.

What are the DEWS contribution rates?

DIFC employers must contribute 5.83 percent of basic salary for employees with less than 5 years of service and 8.33 percent for employees with 5 or more years of service. Contributions are calculated on basic salary only and are paid monthly, denominated in USD or AED at a fixed rate of USD 1 to AED 3.675.

Are employee contributions required under DEWS?

No. DEWS does not require any mandatory employee contribution. However, employees can choose to make voluntary contributions through salary deduction to build additional long-term savings, with flexible withdrawal options of up to two partial withdrawals per year capped at 30 percent of the voluntary savings pot.

Does DEWS replace the traditional UAE end-of-service gratuity?

Yes, but only within the DIFC. DEWS replaced end-of-service gratuity for DIFC employers from 1 February 2020. Outside the DIFC, mainland and most free zone employers still operate under the traditional gratuity model defined by UAE Federal Decree-Law No. 33 of 2021, with the optional Savings Scheme launched under Cabinet Decision No. 96 of 2023.

What happens to gratuity accrued before DEWS started?

Gratuity accrued by DIFC employees up to 31 January 2020 is preserved and payable upon termination, calculated on the final basic salary. Employers can choose to pay these legacy entitlements into DEWS or another Qualifying Scheme, or settle them separately when the employee leaves.

Can DIFC employers use an alternative scheme instead of DEWS?

Yes. DIFC employers can opt for an alternative Qualifying Scheme that meets the regulatory standards set by the DIFC Authority. Approved alternatives such as GO SAVER are available, and any scheme used must obtain a Certificate of Compliance from DIFCA before replacing DEWS.

When can an employee withdraw their DEWS savings?

Employees can withdraw their DEWS balance when they leave their DIFC employer or reach 65 years of age. Voluntary contributions can be partially withdrawn up to twice per year through the Zurich Workplace Savings online portal, subject to the 30 percent limit on the voluntary pot.

How are DEWS contributions invested?

DEWS contributions are invested through a range of professionally managed funds, including passive index-tracking options and Shariah-compliant funds. Members can choose from a curated list of investment options based on their risk appetite, or accept the default investment strategy designed by Mercer for members who do not make an active choice.

How does Mercans help DIFC employers with DEWS compliance?

Mercans automates the full DIFC payroll and benefits stack through its HR Blizz platform, covering DEWS contribution calculations, pre-2020 gratuity tracking, USD and AED currency handling, integration with Zurich Workplace Solutions, and coordination with WPS, GPSSA, and MOHRE rules across DIFC and the wider UAE. Companies can get started at the Mercans UAE payroll page or explore Mercans payroll software for the UAE.