UAE fines workers who failed to register for unemployment insurance

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UAE imposes fines on workers who failed to register for unemployment insurance

The Ministry of Human Resources and Emiratisation (MOHRE) has imposed fines on workers who failed to register for the mandatory unemployment insurance.

The UAE unemployment insurance scheme is mandatory for all employees, whether they are in the private sector or public sector. The deadline for subscription ended on October 1. According to MOHRE, approximately 14 percent of qualified workers were fined for failing to register for the insurance.

“Workers who fail to subscribe to the system face a Dh400 fine, while those who do not meet their regular payment obligations incur a fine of Dh200,” according to MOHRE in a statement.

The ministry said that fines can be paid using the MOHRE app, its website, or its authorised business service centers. The ministry’s digital channels allow users to submit requests to pay fees in installment plans to reduce the burden on workers.

Requests to be exempt from the system can also be submitted, along with supporting documents, where the Mministry notifies applicants of its decision in that regard within 15 working days through its official channels. Those exempt from subscribing include investors, business owners, domestic workers, employees with temporary work permits, juveniles under the age of 18, and retirees who receive pension and have joined a new employer.

Private sector employees who were issued work permits after October 1 were given four months to register for unemployment insurance to avoid a Dh400 fine.

What happens if you don’t pay your fines?

The ministry urged workers to pay their fines promptly in order to avoid administrative measures, including being denied new work permits. The fine amount will then be deducted from the employee’s salary or end-of-service benefits.

What is the UAE unemployment insurance?

The system offers social security to insured workers who lost their jobs, providing up to three months of financial compensation following loss of employment, while they secure a new job opportunity.

How do you subscribe?

Subscription can be done via the Involuntary Loss of Employment (ILOE) Insurance Pool website iloe.ae, the ILOE app, self-service kiosks, ATMs, business service centres, exchange companies, banking apps, telecom companies, or by callingthe ILOE call centre on 600599555.

How much is the UAE unemployment insurance?

For those with a basic salary of Dh16,000 or less, the insurance premium is set at Dh5 per month (Dh60 annually), and monthly compensation capped at Dh10,000 per month when they claim their insurance. For those with basic salary exceeding Dh16,000, the insurance premium is Dh10 per month (Dh120 annually) with a monthly compensation of up to Dh20,000 when they claim their insurance.

Who pays for it?

The employee must pay for his or her own insurance policy.

How do you claim UAE unemployment insurance?

The insurance compensation can be claimed as long as the employee has subscribed to the Unemployment Insurance Scheme for at least 12 consecutive months. The claim can be submitted within 30 days of job loss and will be processed within two weeks of submission. The insured’s right to compensation is forfeited if he or she cancels their residency and leaves the country, or joins a new job, within the processing period.

How is insurance compensation calculated?

The compensation is calculated at the rate of 60 percent of the average basic salary for the last six months before unemployment and paid for a maximum of three months for each claim from the date of unemployment.

The compensation is paid for a maximum of three months from the date of unemployment for each claim, provided the employee was not terminated for disciplinary reasons, and has not voluntarily resigned. ICA/Expat Media


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