The United Arab Emirates’ Ministry of Human Resources and Emiratisation (MoHRE) has revealed compensation details as part of its full Unemployment Insurance Scheme for eligible private sector employees.

The job loss insurance scheme was launched in 2023 to provide support to all private sector employees in the UAE who lose their jobs involuntarily. Over 6.5 million employees subscribed to the scheme within a few months of its launch.

Announcing the scheme, the Ministry said, “If you lose your job, the Unemployment Insurance Scheme provides you with cash compensation for up to 3 months or until you find a new job.”

It shared that, "Employees earning AED 16,000 or less will pay an insurance premium of AED 5 per month (AED 60 per year), with a maximum monthly compensation of AED 10,000 if they involuntarily lose their job.

Those earning above AED 16,000 fall into the second category, paying AED 10 per month (AED 120 per year), with compensation capped at AED 20,000 per month if they involuntarily lose their job.”

Underlining the eligibility criteria, the Ministry shared:

1. Insured person must have a minimum of 12 consecutive months of subscription
2. Insured must not have been dismissed for disciplinary reasons as per labour laws or federal HR regulations
3. Claims must not involve fraud or fictitious employment, and
4. Compensation ceases if the insured obtains a new job during the payout period.

Additionally, the insured must have paid all premiums according to their selected schedule, or face a fine of AED 400.

They must submit proof of job loss or layoff, excluding voluntary resignation. The claim must be submitted within 30 days of the job loss, which must not be a result of strikes or non-peaceful protests. The insured must also reside in the UAE to continue receiving compensation.

The Ministry also noted five types of workers excluded from enrolling in the scheme: “All employees in the federal government sector and the private sector are required to participate in the system by purchasing an insurance policy that covers them in case their service ends according to the established eligibility criteria. The following categories of workers are excluded from the scheme:

1. Investors (the owners of the establishments where they work)
2. Domestic workers
3. Employees with temporary contracts
4. Juveniles (those under the age of 18)
5. Emirati citizens who have met the conditions for retirement or retirees who receive a pension and have joined a new job.

All employees—Emiratis and expatriates, except those mentioned above—must subscribe to the scheme or face a penalty of AED 400.

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The scheme, under Federal Law Decree No. 13 of 2022, notes some additional limitations - A compensation period of 3 months is available for each claim, provided that:

• The coverage period does not exceed twelve (12) months during the insured's employment in the UAE labour market.
• Additional benefits may be negotiated between the insured and the service provider.
• Compensation payments made under this Decree-Law shall not prejudice any other statutory compensation or entitlements available to the insured.