Can You Get Unemployment Insurance in the UAE?
We all know about the Unemployment Insurance scheme but only a few of us know how this scheme works and about its benefits. So in this article, we will try to give you details about the Unemployment Insurance Scheme UAE and its benefits. Unemployment Insurance can be defined as a method for the government to provide financial support to people who are unemployed. The country also provides support to the families of those people who are unemployed. Well, if you think about how much money a person will get from the Unemployment Insurance scheme then this article can help you in knowing all about it in detail.
What is the unemployment Insurance scheme in UAE?
The Unemployment Insurance scheme is a form of insurance providing financial support to Emiratis and residents if they lose their jobs. It aims to ensure that the unemployed maintain their standard of living and helps attract international talent to the UAE workforce. And it is part of the Ministry of Labour and Social Affairs. If you lose your job, then you are eligible for unemployment benefits. The amount of unemployment benefits depends on how long you have been working and how many hours per week you were working before losing your job. Workers or employees will receive financial support in exchange for a monthly insurance premium paid while they are employed.
Who is eligible for UAE unemployment compensation?
The UAE unemployment compensation scheme is open to all nationalities working for private or federal government employers. It does not apply to foreign workers, domestic workers, or people on a temporary basis. The scheme also excludes investors, business owners who own and manage their businesses themselves, as well as those who receive pensions and have joined a new employer. In the UAE, you may be eligible for unemployment compensation if your employer has terminated your employment contract and you are no longer working for that employer. To be eligible for unemployment compensation, you must meet all of the following conditions:
1. You were employed by the same employer for more than one year at the time of termination.
2. You have not resigned from your job voluntarily or have not been dismissed for misconduct or poor performance.
3. You should be or above 18 years old.
4. The cost for this scheme involves :
Based on your salary of AED 16,000 or less, you will need to pay a monthly insurance premium of AED 5. This means that for the year, you will pay AED 60. The compensation for this category should not exceed AED 10,000 monthly. People with a basic salary of more than 16,000 dirhams will pay 10 dirhams each month—that is, 120 dirhams per year. Compensation for these workers should not exceed 20,000 dirhams per month. An employee can pay the premium on a monthly, quarterly, half-yearly, or annual basis. In addition to the basic package, the insured worker may subscribe to additional benefits.
How can apply for unemployment insurance in UAE?
In the UAE, unemployment insurance is provided by the Ministry of Labour through seven channels:
- Insurance official website
- Business service centers
- Money exchange companies
- Du and Etisalat networks
- MOHRE-specified insurance companies(Such as: Dubai insurance company, Abu Dhabi national insurance company, Al Ain Ahlia insurance company, Emirates Insurance Company, National general insurance company, Orient insurance, Abu Dhabi national takaful, company, Oman Insurance company, Orient UNB Takaful company)
- Bank ATMs
- Through SMS
How to claim this insurance?
If you lose your job, within 30 days from the date of your unemployment, you must submit a claim to your insurance company with the required information. Your insurance company has two weeks, from receiving your claim, to transfer compensation money into your bank account.
Employees of the federal government are covered by an ‘Unemployment Insurance Scheme’ that provides them with compensation for up to three months after they lose their jobs. The insurance is paid for by employers and employees, and the Federal Authority for Government Human Resources will report any breach of the terms of the policy by insurance companies.
What is the timeline to apply for unemployment Insurance in UAE:
The UAE unemployment insurance scheme gives you a grace period of six months till June 30, 2023,to subscribe to the ILOE. If you were employed on a date later than Jan 1, 2023, you will have a grace period of four months to subscribe starting from the day you landed in the UAE or the day your visa was changed.
If you’re having any labor law issues in the UAE, we’re happy to help. We’ve got a team of experts who are ready and waiting to help you out with all your questions.
What are the penalties for non-compliance with unemployment insurance?
- Failure to subscribe by the October 1 deadline results in a Dh400 fine. Subscribers who do not pay premiums for more than three months face an additional Dh200 fine. Unpaid fines may lead to the denial of new work permits.
Can fines be paid in installments?
- Yes, individuals can pay fines in installments. The Ministry of Human Resources and Emiratisation (Mohre) offers this option to ease the financial burden.
Who is exempt from unemployment insurance?
- Certain groups, including investors, domestic workers, temporary employees, juveniles under 18, citizens eligible for retirement, and retirees receiving pensions, are exempt from the unemployment insurance scheme.
Can new employees join this unemployment scheme in Dubai, UAE?
- New employees in the private sector receiving work permits after October 1 must subscribe to the scheme within four months to avoid a Dh400 fine.
How can individuals check their fines and appeal if necessary?
- Employees can check fines through the Mohre app, website, or business service centers. They can appeal fines, with decisions issued within 15 working days.
Can individuals claim compensation if they leave the country or find a new job?
- No, compensation can only be claimed if the employee has been subscribed for at least 12 consecutive months and is not leaving the country or securing a new job.