UAE: Unemployment Insurance compulsory from next year

Ministry of Human Resources and Emiratization (MoHRE) has announced that it is a compulsory requirement that all employees from the private and public sectors must subscribe to the unemployment insurance scheme with effect from 1st January 2023.

The new rule of the unemployment insurance scheme will provide a three-month financial safety for Emiratis and residents if they lose their jobs. The scheme offers a monetary incentive for a predetermined amount of time that cannot exceed three consecutive months per claim in the case of employment termination due to a non-disciplinary reason.

Your monthly basic pay will determine how much unemployment compensation you receive from the scheme. Employees can enroll in the Unemployment Insurance Scheme for as low as Dh5 each month.

Investors, proprietors of businesses where he/she works, domestic assistants, employees with temporary contracts, minors under the age of 18, and retirees who get a retirement pension and have started a new career are a few examples of exemptions.

AED 5 can be paid for the insurance by workers whose basic salary is less than AED 16,000 per month. This category's monthly compensation will not exceed AED 10,000.

AED 10 per month can be paid for insurance by workers whose basic salary is more than AED 16,000. In this category, the maximum monthly compensation is AED 20,000.
According to the ministry, it will be calculated at a rate of 60% of the basic salary.