Learn More about The Involuntary Loss Of Employment Insurance in the UAE
Losingajobsuddenlycangiverisetoanumberofunanticipatedproblems,andthesituation becomesworseifyouaretheonlyearningmemberinthefamily.Thankstothenewly introducedUnemploymentInsuranceScheme,employeesintheUAEwholosetheirjobscan availamonthlypaymentuntiltheyfindanewjob.
RegulatedbytheFederalDecree-LawNo.13of2022,ontheInvoluntaryLossofEmployment (ILOE),theinsuranceschemeisaimedtoprovideacertainamountasincometoapersonwho haslosthis/herjobintheUAE.Itisawelcomingstepfortheworkforceinthecountry,toafford themprotectionandsupportintimesofunemploymentduetoreasonssuchaslayoffsorfiring.
Thehighlightsofthisschemearegivenbelow.
Eligibility:TheschemeisapplicabletoUAEcitizensaswellasresidents,engagedinthefederal governmentsectorortheprivatesector.Toclaimtheinsurancescheme,anemployeehasto fulfillthefollowingconditions:
1. Hemusthavecompleted12consecutivemonthsinthepreviousjobstartingfromthe dayofsubscriptiontothescheme
2. Hemustnothavebeendismissedfromemploymentbecauseofdisciplinaryactions underthelawsoftheUAE
3. Hemustnotclaimtheschemethroughfraudulentmeans,andtheworkdonebythe employeeshouldnotbefictitious
Iftheemployeejoinsanotherjobduringthecompensationperiod,hewillnotbeentitledtoit anymore.
Exceptions:Theinsuranceschemedoesnotapplytothefollowingcategoriesofemployees:
1. Businessownersowningandmanagingentirebusinesses
2. Domesticworkers
3. Employeesundertemporarycontracts
4. Juvenilesunder18yearsofage
5. Retireesreceivingapensionwhohavejoinedanewjob
Amount and Benefits: Theamounttobepaidtoanemployeeinfurtheranceofthisschemewill becalculatedonamonthlybasis,withtherateof60%ofthebasicsalary,cappedatAED20,000. Theamountwillbepaidforthreeconsecutivemonthsfromthedateoflosingthejob. Additionally,theinsurermayprovideextrabenefitsundertheschemefortheemployee.The
paymentunderthisschemewillnotbartheemployeefromanyothercompensationswhichhe isentitledtoreceive.
Costs:TheMinisterialDecisionNo.604of2022OntheUnemploymentInsuranceSystem,under Article3,laysdowntheamounttobepaidaspremiumundertheUnemploymentInsurance Scheme.
EmployeesgettingabasicsalaryofAED16,000orlessarerequiredtopayapremiumofAED5 permonth,whileemployeesearningabasicsalaryofmorethanAED16,000amonthare requiredtopayAED10amonth.Theamountiskeptminimaltoensurecompliancewiththe schemebyemployeesinallsectors.
Penalties:Itistobenotedthattheemployeescoveredbythisschemearemandatedtoavailthe insurancebefore30thJune,2023,asperArticles9and11ofMinisterialDecisionNo.604of 2022,otherwisetheywillbeliabletopenaltyofanamountofAED200or400,dependingupon thepremiumamountcontributed.
Source url :- https://www.alrowaad.ae/legal-blog/learn-more-about-the-involuntary-loss-ofemployment-insurance-in-the-uae/