UAE workers must opt-in for unemployment insurance from 2023

UAE workers must opt-in for unemployment insurance from 2023

The UAE has announced the prices for its new unemployment insurance for private and federal sector employees after signing an agreement with a group of nine local insurance companies.

The Ministry of Human Resources and Emiratization (MoHRE) announced on Wednesday that the scheme will go into effect from January 1, 2023. WAM reported on Wednesday that employees in the UAE must subscribe to the scheme from 2023. Employees who work on a commission basis can also opt-in to the government-backed scheme.

Some exemptions include investors, owners of establishments in which he or she works, domestic helpers, employees with a temporary employment contract, juveniles under the age of 18, and retirees who receive a retirement pension and have joined a new job.

Cost of Insurance:

The cost of insurance has been divided into two categories:

- Employees with a basic salary lower than $4,350 (AED 16,000) can contribute $1.3 (AED 5) per month toward insurance. Monthly compensation for this category will not exceed $2,720 (AED 10,000).

- Employees with a basic salary higher than $4,350 (AED 16,000) can contribute $2.72 (AED 10) per month toward insurance. Monthly compensation in this category will not exceed $5,440 (AED 20,000).

The contribution toward the unemployment fund can be made monthly, quarterly,