Over 5.7 million employees subscribed to Unemployment Insurance Scheme

The Ministry of Human Resources and Emiratisation (MoHRE) revealed that approximately 5.73 million employees have subscribed to the Unemployment Insurance Scheme since it went into effect on 1 January 2023, up until 25 September Including more than 5.6 million subscribers in the private sector and more than 87 thousand subscribers in the federal government sector.

The Ministry made the announcement as the deadline for subscribing in the system approaches, where starting from 1 October 2023, a AED400 penalty will be applied to those eligible for the system who have not subscribed. This includes citizens and residents working in the private and federal government sector, excluding investors (business owners who own and manage their business themselves), domestic workers, temporary employees, minors under the age of 18, and retirees who receive pension and have joined a new employer.

The MoHRE issued a press statement urging those eligible for the system to register immediately in order to avoid fines and benefit from the advantages it offers. The system aims to provide a social safety net for citizens and residents, ensuring a decent life for them and their families until alternative employment opportunities arise. It also aims to attract and retain top global talent to the UAE labour market.

It is noteworthy that the responsibility for participating in the system falls on the employee in accordance with Federal Decree Law No. (13) of 2022 regarding unemployment insurance, while the option is available to employers to register their workers in the system without charging the employer any costs.

Subscription can be completed by visiting the Involuntary Loss of Employment (ILOE) Insurance Pool website, the ILOE smartphone application, designated physical kiosks, business service centres, exchange companies (such as Al Ansari Exchange), and banks’ smartphone applications.

The Unemployment Insurance Scheme is divided into two categories: the first covering those with a basic salary of AED16,000 and under, where the insurance premium for the insured employee in this category is set at AED5 per month (AED60 annually), and the maximum monthly compensation is set at AED10,000.

Meanwhile, the second category includes those with a basic salary exceeding AED16,000, and the insurance premium is AED10 per month (AED120 annually). The monthly compensation for this category is capped at AED20,000.

The insurance compensation can be claimed as long as the insurer (employee) has been subscribed to the Unemployment Insurance Scheme for at least 12 consecutive months. The insured’s right to compensation is forfeited in the event that he/she cancels their residency and leaves the country or joins a new job, within the processing period. The claim will be processed within two weeks of submission.

The compensation is calculated at the rate of 60% of the average basic salary in the last six months before unemployment, and paid for a maximum of three months for each claim from the date of unemployment, provided the employee in question was not terminated for disciplinary reasons, and has not voluntarily resigned.

News Source: Emirates News Agency