A new mandate is impacting employees who have not subscribed to the unemployment insurance scheme in the UAE. A fine of Dh400 is being imposed on those who missed the October 1 deadline for enrollment. Additionally, employees who have subscribed but failed to pay premiums for over three months will be subjected to a Dh200 fine.
The Ministry of Human Resources and Emiratisation (Mohre) has announced that non-payment of these fines will result in the withholding of new work permits. Furthermore, fines may be deducted from the employees’ salaries or their end-of-service gratuity.
To assist employees, Mohre has provided options to check for incurred fines through their app, website, or at business service centres. Payment plans are available, and those fined have the right to appeal within a 15-day period.
As of November 15, over 6.6 million people have joined this mandatory scheme, which began on January 1, 2023. The scheme, designed to offer job security, provides compensation for up to three months in the event of job loss, applicable to both Emiratis and expatriates in the federal government and private sectors.
For new employees in the private sector receiving work permits post-October 1, there is a four-month window to enroll in the scheme, with non-compliance resulting in a Dh400 fine.
There are exemptions for certain groups, including investors, domestic workers, temporary employees, those under 18, eligible retirees, and retirees already receiving a pension and working with a new employer.
The scheme is bifurcated into two categories based on basic salary. For salaries up to Dh16,000, the premium is Dh5 per month, with a maximum monthly compensation of Dh10,000. Salaries exceeding Dh16,000 fall into the second category, with a monthly premium of Dh10 and a compensation cap of Dh20,000.
Eligibility for compensation requires at least 12 consecutive months of subscription and is void if the employee leaves the country or secures new employment. Compensation is calculated at 60% of the average basic salary of the last six months and is payable for a maximum of three months, provided the termination was not due to disciplinary reasons.