UAE announces new unemployment insurance scheme for all workers

The unemployment insurance scheme aims to strengthen the competitiveness of the labor market, to provide a social security umbrella for workers in the event of job loss and to establish a stable working environment for all.

According to Al Awar, the unemployment insurance system will be accessible to all public and private sector workers in the UAE, while seeking employment after losing a job.

“Employees who lose their jobs will receive cash assistance for a period of time until the employee finds another job. The scheme applies to all nationalities in the private and public sectors,” the minister said during a press conference held at the ministry’s headquarters in Dubai.

However, investors, domestic workers, temporary contract workers, people under the age of 18 and pensioners who have joined a new job will not be part of the unemployment insurance scheme.

“The objective is to ensure stability at work. The UAE aims to attract talented workers and provide job stability,” Al Awar said.

From 2023, employees will have to contribute a small amount of money to the unemployment insurance scheme through insurance companies. “Payment will be made on an annual basis. It will be a small amount and based on the preferred insurance plan between the worker and the insurance company,” Al Awar added.

He said unemployment insurance costs could vary between 40 and 100 Dh per year. The minister said the insurance scheme will include the payment of 60% of the worker’s basic salary for a certain period in the event of job loss, although he did not specify the duration of these payments.

“It’s a safety net for everyone working in the country. We will have final law and regulations for the unemployment insurance scheme and will announce more details later this year,” Al Awar said.

He said the innovative new program will attract more workers and talent to the country and build confidence in the workplace in the UAE. “The new scheme will improve our economy as the worker who loses his job will be supported by this insurance without the burden being on the employers,” Al Awar added.

About Tammy N. McFarlane

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