The scheme provides a social safety net for citizens and residents while ensuring that they have a decent life until alternative employment arises
The UAE Ministry of Human Resources and Emiratisation (MoHRE) said more than 6.5 million employees have subscribed to the unemployment insurance scheme from January 1, the starting date of registration to October 1.
“This signals employees’ commitment to complying with Federal Decree-Law No. 13 of 2022 on unemployment insurance scheme and underlines their awareness of the benefits the system provides,” MoHRE said in a statement that was seen by WAM.
The scheme provides a social safety net for citizens and residents and ensures that they have a decent life until alternative employment opportunities arise.
The Ministry said the scheme is aimed at attracting and retaining top global talent to the UAE labour market.
With a Dhs400 fine to be imposed on eligible employees who did not enrol themselves in the scheme, MoHRE said workers can check if the fine was imposed on them via MoHRE’s app, website or business service centres.
The Involuntary Loss of Employment (ILOE) scheme covers citizens and residents working in the private and federal government sectors.
MoHRE said investors, domestic workers, temporary employees, minors under the age of 18, and retirees who receive a pension and have joined a new employer are excluded from the scheme.
The Ministry urged those eligible for the system to register, noting that while the option has been provided for employers to register their employees in the system, it is ultimately the employee’s responsibility to enrol, not the employer’s, who incurs no additional costs.
UAE’s Unemployment Insurance Scheme
The UAE’s ILOE is divided into two categories: the first covers those with a basic salary of Dhs16,000 or less and the insurance premium for the insured employee in this category is set at Dhs5 per month or Dhs60 annually. The maximum monthly compensation for this category is set at Dhs10,000.
The second category includes those with a basic salary exceeding Dhs16,000, where the insurance premium is Dhs10 per month or Dhs120 annually. The monthly compensation for this category is capped at Dhs20,000.
The insurance compensation can be claimed if the insurer (employee) has been subscribed to the scheme for at least 12 consecutive months.
The insured’s right to compensation is not eligible if he/she cancels their residency and leaves the country or joins a new job, within the processing period.
MoHRE said the compensation is paid for a maximum of three months from the date of unemployment for each claim, provided the employee in question was not terminated for disciplinary reasons, and did not resign voluntarily.
The amount is calculated at the rate of 60 per cent of the average basic salary in the last six months before unemployment.
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