Who pays for job loss insurance in UAE and when is compensation due?

Question:  I work for a private company. I want to know about the involuntary loss of employment (ILOE) law. Is the employer responsible for paying the value of this insurance to the insurance company? And does the insurance company pay compensation if the worker leaves work of his own accord? Please advise.

Answer: This scheme provides security for employees who lost their jobs due to reasons other than disciplinary actions or resignation. Emiratis and residents working in the federal government and private sectors are eligible for such insurance. The employee (insured) himself shall be obligated to pay the due payments according to the agreed time schedule and within a maximum of 90 days from the payment due date. The employee shall also bear all fines and penalties according to the legislation in force; and shall in this case be deemed to have an interruption of the subscription.

Maximum monthly limit is 60% of basic salary/wage and for a maximum of three months per claim from the date of unemployment, whereby the maximum monthly limit does not exceed Dh10,000 for the first category (basic salary Dh16,000 or below) and Dh20,000 for the second category (basic salary above Dh16,000).

The maximum benefit for any one claim is three months. The aggregate claim shall not exceed 12 months over the entire service period of the insured in the country.

In the event that the insured exhausts the maximum claim limit determined to be three months during the Insurance Certificate Period, whether through one or several claims, the Insurance Certificate shall be considered cancelled.

In the event that the Insured exhausts the maximum claim limit during the Insurance Certificate Period, then the Insured shall be obligated to subscribe for a period of 12 consecutive months before submitting a new claim. Such condition shall not apply in case the Insured has received a benefit amounting to less than the maximum claim limit (i.e., three months).