The UAE Ministry of Human Resources and Emiratisation confirmed that the unemployment insurance programme is optional for employees in free zones, local and semi-government bodies. This clarification comes amidst prior reports suggesting that the scheme was compulsory for both Emirati and foreign employees.
The ministry, on the social media platform formerly known as Twitter, announced on Monday that, “The second phase of the system on May 2, 2023, allowed employees in local government bodies, semi-government, and free zones to optionally register via the ID number.”
Federal Decree Law No (13) of 2022 mandates registration in the scheme for private sector and federal government employees. However, it’s optional for those in free zones, semi-government and local government bodies.
To date, over 6.5 million employees have enrolled in the UAE’s unemployment insurance system. But starting from October 1, eligible individuals who haven’t subscribed will face a Dh400 penalty. Additionally, neglecting registration or lapsing in insurance payments will make employees ineligible for a new work permit.
Dr Abdullah Al Nasser, chairman of the Araa group advocate and legal consultancy, stated, “Article 10 of the ministerial resolution No. 604 of 2022…specified that employees will not receive a new work permit until all outstanding fines are settled.”
Those who don’t register or default on their premiums for over three months will be subjected to fines. The UAE government’s intention with this scheme is to ensure a safety net for its citizens and residents, enabling a decent livelihood until they secure another job.
Mohammad Hamdi, an employee in Sharjah, expressed concern about missing the deadline due to lack of awareness and technical issues with the website. “My employer did not inform me about this programme… I managed to register but it was already October 1, and I don’t know if I will be fined,” he mentioned.
To understand and register for the programme, interested individuals can visit the Involuntary Loss of Employment Insurance Pool website or the ILOE smartphone application. The scheme offers two insurance categories based on the basic salary and provides compensation under specific conditions, with a processing time of up to two weeks post-submission.
