At a glance: DEWS vs traditional gratuity
| Feature | Traditional gratuity | DEWS / new savings scheme |
|---|---|---|
| How it works | Employer pays lump sum from own funds on exit | Monthly contributions go into invested fund in employee's name |
| Contribution rate | N/A — calculated at exit (21 days/year for first 5 years; 30 days/year after) | 5.83% of basic salary (years 1–5); 8.33% after 5 years |
| Investment growth | None — entitlement is a fixed formula | Yes — contributions are invested and can grow |
| Risk if employer fails | High — gratuity is an unsecured creditor claim | Low — fund is held separately, not on employer's balance sheet |
| Portability | Paid out on exit; starts again at new employer | Fund is portable; continues accumulating across employers (in supported schemes) |
| Who it applies to | All private sector employees under UAE Labour Law | DIFC (mandatory DEWS), ADGM, and UAE mainland (voluntary/opt-in per employer) |
| Employee choice of funds | None | Yes — employees typically choose from a menu of risk-rated funds |
What is DEWS?
DEWS stands for DIFC Employee Workplace Savings. It is a mandatory defined-contribution end-of-service benefits programme for employees working in the Dubai International Financial Centre (DIFC). Launched in February 2020, it replaced the traditional gratuity system for DIFC-based employees and was the first scheme of its kind in the UAE.
Under DEWS, employers contribute a percentage of each employee's basic monthly salary into an investment fund — currently administered by Equiom (the scheme trustee) with investment options managed by Zurich International Life. The money is held in a trust, entirely separate from the employer's own finances. The employee chooses how it is invested from a set of fund options ranging from conservative (capital protected) to growth-oriented.
DEWS is mandatory for all DIFC-registered employers. If you work in the DIFC, your employer must enrol you in DEWS — there is no opt-out. The traditional gratuity system no longer applies in the DIFC.
How contributions work
The contribution rates mirror the traditional gratuity formula, applied monthly rather than as a lump sum at exit:
- First 5 years of service: Employer contributes 5.83% of basic monthly salary per month (equivalent to 21 days' basic salary per year)
- After 5 years of service: Employer contributes 8.33% of basic monthly salary per month (equivalent to 30 days' basic salary per year)
Employees can also make voluntary additional contributions, which they can invest in the same fund options. These voluntary contributions are separate from the employer's mandatory contributions and can typically be withdrawn with more flexibility.
An employee earning AED 20,000 basic salary in year 1 would see their employer contribute AED 1,166 per month (5.83%) into the DEWS fund. Over 12 months that is AED 13,992 — plus investment returns. Under traditional gratuity, the year-1 entitlement would be AED 13,698 (21/365 × AED 20,000 × 12 months) — no investment growth added.
Investment fund options
DEWS participants can choose from a range of investment funds. The available options (via Zurich International Life) typically include:
- Capital Protected Fund: For employees who want certainty over growth. Returns are modest but the underlying capital is protected.
- Moderate Fund: Balanced allocation across equities, bonds, and alternatives. Medium risk, medium expected return.
- Growth Fund: Equity-heavy allocation for employees with longer time horizons. Higher expected return, higher short-term volatility.
- Sharia-compliant Fund: For employees requiring halal-compliant investing — typically sukuk and Sharia-screened equities.
Employees can switch between funds at any time. For younger employees with 10+ years before they expect to leave the UAE, the growth fund is typically the most appropriate — but investment choice is personal.
ADGM and UAE mainland schemes
DEWS is the DIFC scheme. Other free zones and the UAE mainland have developed parallel arrangements:
ADGM
The Abu Dhabi Global Market (ADGM) introduced its own end-of-service savings scheme in 2023, modelled closely on DEWS. Employers in the ADGM are required to enrol employees. The contribution rates match the DEWS structure (5.83% / 8.33%).
UAE mainland voluntary scheme
In 2021, the UAE Cabinet approved a voluntary alternative end-of-service benefits scheme for mainland employers. Employers can opt into this scheme — contributing monthly to government-approved investment funds instead of carrying the gratuity liability on their books. It is not yet mandatory for mainland employers, but uptake has been increasing as companies recognise the balance sheet benefits and the scheme improves employee retention.
If your mainland employer has enrolled in the voluntary scheme, you would receive monthly contributions rather than a traditional lump-sum gratuity. Check with your HR department to confirm which system your employer uses.
If you work in mainland UAE (not DIFC or ADGM), you are most likely still under the traditional gratuity system. The voluntary mainland scheme is employer-elected. Your offer letter, employment contract, and HR department can confirm which applies to you.
Vesting: when do you get the money?
Under DEWS, vesting — when you become entitled to the accumulated fund — follows rules that broadly reflect the old gratuity entitlement structure:
- Under 1 year of service: No entitlement to employer contributions (same as traditional gratuity)
- 1–5 years: You are entitled to the employer contributions proportional to your service, subject to vesting schedule
- 5+ years: Full entitlement to all employer contributions accumulated
Voluntary employee contributions are always 100% vested immediately — they are your own money and you can withdraw them at any time (subject to fund liquidity terms).
When you leave a DIFC employer, your DEWS fund balance is paid out — either as a lump sum or, in some cases, transferred to a new DEWS account with a new employer.
Is DEWS better than traditional gratuity?
For most employees, yes — and for three specific reasons:
1. Investment growth: Traditional gratuity is a fixed calculation with zero investment return. DEWS contributions are invested and can compound over your UAE career. An employee who stays in the DIFC for 10 years under a moderate-growth fund scenario could realistically receive 20–30% more than the equivalent traditional gratuity payout.
2. Reduced counterparty risk: Traditional gratuity sits on the employer's balance sheet as an unsecured liability. If your employer becomes insolvent, your gratuity joins the queue of creditor claims. Under DEWS, the fund is held in a trust — entirely separate from the employer's finances. If the company fails, your DEWS balance is protected.
3. Transparency: You can log in to your DEWS account and see exactly what has been contributed, what it is invested in, and what it is worth today. Traditional gratuity is invisible until you resign or are terminated — many employees have no idea what they are actually owed until exit.
DEWS is a meaningful upgrade over traditional gratuity for most employees. If your employer is in the DIFC or ADGM — or has voluntarily opted into the mainland scheme — take the time to log into your account, choose your investment fund deliberately, and treat it as the significant retirement asset it is.
Frequently asked questions
Yes. DEWS is mandatory for all DIFC-registered employers. There are no exceptions. If you believe your employer is not making contributions, contact DEWS directly (via the Equiom/Zurich DEWS portal) or raise it with the DIFC Authority.
You can withdraw your own voluntary contributions at any time. The employer's mandatory contributions are generally accessible only on termination or resignation, subject to the vesting rules. Some hardship provisions may apply — check the DEWS scheme rules for details.
Your vested DEWS balance from your previous employer is paid out to you on exit. Your new DIFC employer then opens a fresh DEWS account for you from day one. Service does not automatically transfer between employers for DEWS purposes.
Yes — unlike traditional gratuity (where resignations within 1–5 years resulted in reduced entitlement), DEWS vesting is based on service tenure and is not reduced simply because you resigned rather than were terminated. After the vesting schedule is satisfied, resignation and termination are treated the same for the purpose of your DEWS entitlement.
The UAE mainland voluntary alternative scheme works similarly. Your employer must have opted in — it is not automatic. Ask your HR team whether the company participates. If they do not, you remain under the traditional gratuity system.
