UAE introduced mandatory unemployment insurance for citizens and expats starting January 1, 2023. It is mandatory for all employees of the public and private sector to be registered for the unemployment insurance scheme, employees not registered will be subject to fines.
However, there are certain categories exempt from the unemployment insurance scheme:
- Employees working in Freezones
- Investors (Owners of companies they work at)
- Domestic helpers
- Temporary contract workers
- Juveniles under the age of 18
- Retirees entitled to pension and joined a new job
Free zone employees who try to sign up on iloe.ae will receive an alert stating “If you are an employee in a free zone; Please note that workers in free zones are not currently covered by the unemployment insurance product (ILOE).
For those eligible, compensation benefits include:
- The Monthly compensation is 60% of the average basic salary over the most recent 6 months prior to the Involuntary Loss of Employment
- For Category A: Maximum Claim Benefits : 10,000 AED per month
- For Category B: Maximum claim Amount : 20,000 AED per month
- Maximum compensation for any one claim: 3 consecutive months
- Maximum Period of Benefits: During the Insurance Period over the entire work life of the Insured in the United Arab Emirates the aggregate Claim Payment shall not exceed 12 monthly benefits (regardless of the number of Claims submitted
UAE employees can use the following subscription channels:
- Insurance Pool’s website and its smart application
- Bank ATMs and kiosk machines
- Business service centres
- Money exchange companies
- du and Etisalat
- SMS
According to the Insurance Pool website, in order to be eligible for compensation, the insured must meet the following criteria:
- There must be a minimum subscription period of 12 consecutive months for the insured in the scheme. Provided that there is no interruption in the subscription for three consecutive months
- The Insured was committed to pay all the insurance premiums due on time
- The Insured proves that the reason of unemployment is not due to resignation
- The Insured may not be dismissed for disciplinary reasons under the Labour Relations Law and the Human Resources Law of the federal government in addition to any applicable legislation
- Submit the claim within 30 days from the date of loss of the work relationship or the settlement of the labour complaint referred to the judiciary
- The Insured worker should not have an existing complaint related to the absence from work
- The Insured shall not be entitled for compensation if there has been fraud or deceit involved in his claim or if the establishment where they work for is fictitious
- The Loss of Employment should not be the result of non-peaceful labour strikes or stoppages, whether they result in harm or not
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