EK Exchange Rate Protection

[yankee22]

Hey guys,

Was hoping someone could explain this Exchange Rate Protection stuff to me. I'm a Canadian moving to Dubai in early February. I was looking over the package they sent me but I don't quite understand how the ERP works. I am also an American (dual). I'm from Vancouver but work in Seattle.

I was told that depending on the country you use for your ALD, you can actually make a little more money due to the exchange rate. Not quite sure how this is so but that's what i heard.

Would Canada be the better choice for my ALD ? The confirmed ticket home is not that big of a deal because Vancouver and Seattle are only a few miles apart. Either city would be fine.

More specifically, would I make a few extra bucks a month by using Canada or would it be better to use the USA where it is fixed.

Thanks.

[Icarus]

Seeing as the AED (UAE Dhiram) like most of the other GCC currencies are tied at a fixed rate to the US$ I imagine that means you dont get any protection as the rate never fluctuates. Nice to see some airlines in this region still provide that feature - GF used to many many moons ago but not for quite sometime now - makes a huge difference to a lot of expats when the USD is weak as it typically is for long periods!

[yankee22]

Still not sure what you're saying.

Is it good to be tied to the USA $$$ or not??

I'm wondering if I should use Canada or the USA for my Exchanse Rate Protection.

Thanks.

[donpizmeov]

The Dirham is fixed to the $US, hence no exchange rate protection if your home home country uses $US. So you will get exchange rate protection for the $Canuk but not for the $US.


Don

[yankee22]

So is that a good thing or bad??? I'm still a little confused.

Does having the Exchange Rate Protection (ie: Canada- using the Canadian dollar) , better then using the fixed reate USA dollar??

I believe you're saying the Canadian 'E.R.P' is a better deal then the fixed rate USA. Is that correct????

[616200]

Yes,you got that right!
In case you're coming from CAN you will get EXTRA money.In case you're from the U.S you don't 'cause the Dollar does't fluctuate against the Dirham..:)

[yankee22]

Very well.

Thanks for the clarification.

[Kennytheking]

ERP is a nifty feature that puts a couple of extra Ditham in your pocket. I have seen up to AED1500 extra on my paysheet. The downside is that if you are sending money home, it is costing you the extra AED to do it cos the ERP payout is a function of your currency getting stronger against the AED(or the us$ for that matter).

IN the bigger scheme of things it is not a huge amount and you don't get any say in what your base currency is. EK will decide based on your passport that you gave them at your interview and where they recruited you from and probably some other factors that I am not privy to. It is also linked to your ALD and ALT.

Good luck. Hope to see you here soon.

KTK

[ruserious]

[flamesuit on]
In simple terms Yankee, come here as a Canadian if you can, you will then get the ERP and avoid any of the negative connotations that are sometimes associated with being a yank :ooh:
If you can fake the cultural norms of a Canadian, so much the better [/flamesuitoff]

P.S. Be careful the ain't stupid in HR and they do read PPrune

[max AB]

The ERP does not cover 100% of exchange fluctuations, it is up to a certain limit and then on the last (6 I think) rolling years. So if the USD tanks against your home currency the ERP will not make up all the shortfall and if it stays tanked then the ERP will gradually reduce to zero. If you don't like exchange rate risks then go for the USD. Guys who arrived here 5-6 years ago from Eurozone are down a lot on there home currency. In my case I have lost about 25% of my pay in home $ terms despite the ERP. If you intend to grow old in the UAE and retire here (apparantly some people do..) then it doesnt matter
Not the companies fault of course....
.

[mensaboy]

Use the ERP for the canadian dollar. You get no benefit if you claim american, your paycheque will be in Dhs and never have ERP. If you claim canadian you will receive ERP with the rolling 6 year average on 50% of your salary. In other words, likely about 1100dhs extra cash each month.
Either way you get paid in Dhs so clearly its better to get some ERP as the worst case scenario means you get your base pay which is what you would get if you claimed american citizenship.

[Fish]

But can you ask whether you want to be US Dollar or Canadian Dollar based? They never gave me the choice between Sterling and Euros... :bored:

[atiuta]

Probably didn't have Euros when you joined Fish!