UAE Unemployment Insurance Scheme: What to Know

The deadline of June 30 is fast approaching for UAE employees to enroll in the nation’s compulsory Unemployment Insurance Scheme.

The Ministry of Human Resources and Emiratization (MoHRE) has urged all eligible employees to take advantage of this program, which provides an affordable safety net against involuntary job loss.

Officially known as the “Involuntary Loss of Employment (ILOE)” scheme was implemented on January 1, 2023.

To ensure peace of mind and enhanced job security, employees are encouraged to promptly register for this scheme before the imminent deadline. By doing so, they can avail themselves of the benefits and support offered by the program in the event of unforeseen employment challenges.

The UAE’s Unemployment Insurance Scheme is a significant step towards fostering greater financial stability for workers across various sectors.

It serves as a vital resource during times of employment uncertainty, empowering individuals with increased resilience and providing them with access to comprehensive assistance. Remember, the June 30 deadline is nearing, so don’t miss out on this valuable opportunity to safeguard your future.

What Is UAE’s Unemployment Insurance Program

The UAE’s unemployment insurance program is designed to provide crucial financial support to individuals who have lost their jobs. Eligible workers can receive up to AED 20,000 per month for a maximum of three months, starting from the date they were employed.

This program serves as a lifeline for those facing the challenging circumstances of involuntary unemployment. By offering a substantial monthly benefit, it aims to help individuals cover their essential expenses and maintain a level of stability during this transitional period.

Beyond financial assistance, the unemployment insurance program empowers individuals by providing them with a sense of security and peace of mind. It allows them to focus on re-entering the job market, exploring new career opportunities, enhancing their skills, or undergoing relevant training programs to improve their employability.

By prioritizing the welfare of its workforce, the UAE government demonstrates its commitment to supporting individuals during times of uncertainty. The unemployment insurance scheme plays a vital role in building a resilient workforce and ensuring a stronger future for both employees and the nation as a whole.

Where To Apply For The Scheme?

The Ministry of Human Resources and Emiratization (MoHRE) has introduced a straightforward process for subscribing to the UAE’s unemployment insurance scheme.

The scheme, known as the Involuntary Loss of Employment (ILOE) program, aims to provide a low-cost job security net to support employees’ career paths and living stability in the UAE, without imposing any additional costs on employers.

To enroll in the program, individuals have several convenient options. The preferred and widely used channel is the ILOE Insurance Pool’s website, offering a user-friendly interface for seamless enrollment.

Alternatively, individuals can also subscribe through the ILOE app, kiosks, business service centers, money exchange centers like Al Ansari, bank smart apps, as well as via SMS or telecom bills. By offering multiple accessible channels, the UAE ensures that employees can easily register for the unemployment insurance scheme.

Advantages Of The UAE’s Unemployment Insurance

Under the UAE’s unemployment insurance scheme, compensation is determined based on a calculation involving the average basic salary earned in the six months preceding the period of unemployment. Eligible individuals can receive compensation equal to 60 percent of this average basic salary.

The compensation is provided for a maximum duration of three months per claim, starting from the date of unemployment.

This calculation ensures that individuals who experience job loss receive financial support that reflects their previous earnings and helps them maintain a certain level of stability during their transition.

By providing compensation at a significant percentage of their average basic salary, the program aims to alleviate the financial burden and assist individuals in meeting their essential expenses while seeking new employment opportunities.

Exempted Categories

Certain categories of individuals are exempted from the UAE’s unemployment insurance scheme. These include investors and company owners, domestic helpers, temporary contract workers, juveniles, and retirees.

These exemptions are in place to align the program with specific employment scenarios and ensure that it focuses on supporting those who are most vulnerable to involuntary job loss.

The program excludes investors and company owners since they typically have different status in the labor market and are responsible for their own employment and financial security. Domestic helpers fall under a distinct employment arrangement that makes their inclusion in the scheme less applicable.

Temporary contract workers are exempted due to the nature of their employment, often involving shorter durations or project-based work. Juveniles and retirees are also excluded as their employment situations differ significantly from the standard workforce.

Claiming The Insurance Scheme

To be eligible for insurance compensation under the UAE’s Unemployment Insurance Scheme, the employee must have subscribed to the program for a minimum of 12 consecutive months. In the event of job loss, the claim can be submitted within 30 days and will be processed within two weeks of submission.

However, it’s important to note that the insured individual forfeits their right to compensation if they cancel their residency and leave the country or secures a new job during the processing period. It’s crucial for individuals to understand these conditions to ensure they meet the requirements and can successfully claim the insurance benefits they are entitled to.

Fines Related To The Insurance

Individuals who fail to subscribe to the UAE’s unemployment insurance scheme may face a penalty of AED 400.

This fine serves as an incentive for eligible workers to comply with the requirement and secure the benefits provided by the program. Furthermore, a separate penalty of AED 200 can be imposed for missing installment premium payments, emphasizing the importance of timely and consistent contributions to the scheme.

These fines encourage individuals to fulfill their obligations and ensure the sustainability of the unemployment insurance system.

Still, Having Doubts?!

Don’t hesitate when it comes to signing up for the UAE’s mandatory unemployment insurance scheme. Marqueway is here to assist you with any uncertainties regarding the application process. Just give us a call, and we’ll provide the clarity you need.

By enrolling in this scheme, you’re taking a proactive step towards empowerment and securing a safer future for yourself. So don’t wait any longer—take action and sign up for the scheme now!

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