UAE Unemployment Insurance: Penalties for Non-Registration
As of October 1, UAE employees who have not enrolled in the country’s unemployment insurance scheme are subject to financial penalties. The UAE Ministry of Human Resources and Emiratisation (MoHRE) will impose a fine of AED400 ($109) on individuals who have not completed their registration.
Who Does the UAE Unemployment Insurance Apply To?
The UAE unemployment insurance scheme is mandatory for a wide range of workers, including those in the federal and private sectors, UAE citizens, residents, and employees in free zones. Introduced in May of the previous year, it provides financial security for both Emiratis and UAE residents.
Over 5.7 Million Already Subscribed
Since its implementation on January 1, over 5.7 million employees have already subscribed to this labor initiative, according to the Ministry. The subscription fee varies, with workers earning basic monthly salaries of AED16,000 or less paying AED5 per month, while those earning more than AED16,000 pay AED10 per month. Additional insurance benefits can also be selected, and the subscription process can be completed online.
Compliance and Penalties
Even registered employees may face fines if they fail to maintain their insurance payments. Penalties range from AED200 for overdue premiums to the potential cancellation of the worker’s insurance certificate. Exemptions are granted to specific individuals, including company owners, domestic staff, temporary contract workers, those under 18, and retirees receiving a pension who have re-entered the workforce.
Compensation and Eligibility
To be eligible for compensation in the event of job loss, participants must have been registered in the scheme for at least 12 months and must submit their compensation request within 30 days of leaving work. Payments are calculated at 60 percent of the individual’s basic salary, with a maximum payout of AED20,000 per month for up to three months.
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