UAE expats and nationals will be eligible for unemployment insurance, a new programme aimed to safeguard people against job loss.
According to various reports on Thursday, Abdulrahman Al Awar, Minister of Human Resources and Emiratisation, announced that employees who lose their jobs due to unforeseen circumstances will receive a basic cash payment each month.
According to the scheme, 60 per cent of their basic earnings will be provided each month for a limited time until they find another job.
Effective from early 2023, the mandatory scheme applies to employees of all nationalities working in the public and commercial sectors. The new insurance scheme aims to improve labour market stability and attract more Emiratis to work in the private sector.
It is part of the UAE’s most recent sweeping reforms aimed at attracting and retaining talent while also increasing the country’s labour market’s competitiveness.
On the other hand, investors, domestic workers, employees on temporary contracts, minors under the age of 18, and retirees with pensions or new employment opportunities will not be eligible for the policy.
How does it work?
Employees will be able to apply for various yearly packages through insurance firms in order to protect themselves against job loss.
The redundancy payout will allow insured workers who are abruptly laid off to recover 60 per cent of their basic earnings, up to a maximum of Dh20,000 each month. The mandatory insurance package would cost workers between Dh40 and Dh100 each year.
The new Regulation of Employment Relations Law and its Implementing Regulations defined the provisions for filing individual or collective labour complaints to the Ministry. Check them out and comment below for any inquiries. #UAE pic.twitter.com/1xGt01rZ1V
— MOHRE_UAE وزارة الموارد البشرية والتوطين (@MOHRE_UAE) May 11, 2022
Employees, however, have the option of applying for higher insurance packages. Insurance packages will be designed to include a wide range of wages and match everyone’s financial competence.
If the dismissed employee does not find another employment within a reasonable time, the financial assistance will be terminated.However, employees will be given insurance policies that will help them financially secure themselves for a longer period of time.
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