UAE announces new unemployment insurance scheme for all workers
New insurance scheme meant for workers of all nationalities working in UAE
Dubai: UAE workers in the public and private sectors will enjoy unemployment insurance from next year, Abdulrahman Al Awar, Minister for Human Resources and Emiratisation, said on Thursday.
The move was part of a series of decisions announced during the Cabinet meeting on Monday, chaired by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. The UAE Cabinet approved the unemployment insurance scheme to provide unemployed individuals with income support for a limited period of time.
The unemployment insurance scheme aims to strengthen the competitiveness of the job market, provide a social security umbrella for workers in case of job loss and establish a stable work environment for all.
According to Al Awar, the unemployment insurance system will be available to all workers in the public and private sectors in UAE, while searching for a job after having lost a job.
“The employees who lose their jobs will receive cash support for a period of time until the employee finds another job. The scheme applies to all nationalities in private and public sectors,” said the minister in a media briefing held at the ministry’s headquarters in Dubai.
However, investors, domestic workers, workers with temporary contracts, people under the age of 18 years and retired persons with a pension who joined a new job will not be part of the unemployment insurance scheme.
“The goal is to ensure stability in the workplace. UAE aims to attract talented workers and ensure work stability,” Al Awar said.
As of 2023, employees will have to contribute a small amount of money for the unemployment insurance scheme through insurance companies. “The payment will be on yearly bases. It will be a small amount and based on the preferred insurance plan between the worker and the insurance company,” added Al Awar.
He said that unemployment insurance fees might range between Dh40 and Dh100 per year. The minister said the insurance plan will include paying 60 per cent of the worker’s basic salary for a certain period in case of job loss, though he did not specify the duration of such payouts.
“It is a safety net for everyone who works in the country. We will have a final law and regulations for the unemployment insurance scheme and will announce more details later this year,” Al Awar said.
He said the new and innovative scheme will attract more workers and talents to the country and will boost trust in the workplace in UAE. “The new scheme will enhance our economy as the worker who loses job will be supported through this insurance without the burden falling on employers,” Al Awar added.
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The mandatory scheme, effective from 2023, will apply to employees in the public and private sectors.
Employees will be able to get different annual packages through insurance companies when they lose their jobs. Workers will have the option to apply for higher insurance packages.
Workers will receive 60 per cent of their basic salaries with a maximum amount of Dh20,000 over a certain period of time.
Domestic workers.
Employees with temporary contracts.
People under the age of 18.
Retirees with pensions who joined a new job.