Unexpected situations can always happen, such as the loss of a job. Not being prepared for an event like this one is highly common. For this reason, the local government is currently looking to support those who lose their jobs without warning with the new UAE unemployment insurance scheme.
In this article, we will provide you with all the information you need about unemployment insurance in the UAE. Discover with us how you can access it and all the benefits you can obtain.
- What is unemployment insurance?
- Why was this new policy created?
- Who can access job loss insurance?
- How can you apply for unemployment insurance in the UAE?
- Some important benefits
- Other things you should know about
- On The Talent Point, you can search for the job of your dreams
1. What is unemployment insurance?
When working for a company, employees cannot always certain that their position is permanent. For example, if their company is not achieving the estimated profits, the first solution they may come to is to cut staff. As a consequence, many people could find themselves suddenly struggling without a steady source of income.
Knowing that most workers are not ready to face this kind of situation, the job loss insurance in the UAE was created. This is a new policy that the local government is currently implementing both in the public and private sector.
Keeping the definition of insurance in mind, the UAE unemployment insurance is a payment issued by the government specifically to those who do not have a job to support their families at the time. It is important to mention that in this new Federal Law in the UAE, all workers must be protected by a job loss insurance.
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2. Why was this new policy created?
The unemployment insurance policy in the UAE was implemented to support employees who lose their jobs unexpectedly. Thanks to this policy, many people can feel relieved knowing that there is a plan B in case they are left without their regular income. In addition, this job loss insurance UAE will be maintained for a limited period while an alternative is being sought.
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With this policy, the UAE government aims to give people time to look for new jobs. This is great news as it provides important financial assistance to individuals and their families during this time of no fixed income. This is undoubtedly a great step by the UAE government to give more security to the employees.
In this new law, both natives and foreigners will be eligible for job loss insurance. With this measure, the UAE aims to attract a lot of foreign talent and position its labor market at a high level. It is also expected that with this policy, many people will have better motivation to choose the UAE as their place to live, work or invest.
3. Who can access job loss insurance?
Both expatriates and nationals can enjoy access to unemployment insurance in the UAE. Moreover, this is compulsory for both the public and private sectors. Below, you will see the exceptions in detail:
- People engaged in investment. In other words, any investors do not qualify for job loss insurance in the UAE.
- Informal workers. For instance, people who clean houses or sell goods on the streets will not qualify.
- People under 18 years of age cannot apply for unemployment insurance in the UAE.
- Retired elders are also a part of this group.
- Workers employed by a company under a temporary employment contract are also not eligible for this policy.
4. How can you apply for unemployment insurance in the UAE?
When it comes to obtaining insurance, you must first go through certain processes. Among those, we can highlight the submission of documents or filling online forms. In the case of UAE insurance, there is the option of contacting an insurance broker, allowing them to take care of everything related to these procedures. In addition, they will find the best plan that suits your needs.
Regarding unemployment insurance in the UAE, as it is a new policy, the authorities are yet to explain how this process will work. However, there are speculations stating that this will not be a complicated or tedious process. Also, it is said that once everything is set, you can contact a new-age insurance broker. They will help you through the entire process.
Although the exact procedure of how to obtain this policy has not yet been implemented, there is information available about what the cost could be. Workers are expected to pay around AED 40 and AED 100 per year. Of course, this may vary depending on the insurance package you wish to purchase.
Additionally, we know that the implementation of unemployment insurance in the UAE will be fast. This is for one simple reason: everything will be processed digitally. By making use of technology, the implementation of job loss insurance in the UAE will be straightforward.
5. Some important benefits
You have already seen everything related to unemployment insurance UAE and why it is being implemented. Now, you can look at the benefits of this new reform for those who have it:
5.1 A monthly payment for a limited time
Even if it is limited, this policy guarantees a monthly income while you look for another job. This job loss insurance allows you to recover 60% of your basic salary up to a maximum of AED 20,000.
5.2 Peace of mind for the unemployed
Becoming unemployed can be a stressful situation for the employee. However, by having access to this policy in case this happens, you no longer have to worry for the time being. You can look for a job more easily without the pressure of losing your home or any other unfortunate situation unemployment can bring.
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5.3 It is available to citizens and foreigners
One of the great advantages of this policy is that foreigners and citizens will be able to opt for it. This is a benefit for all those people from all over the world looking for better working conditions.
5.4 Easy to apply
Because it is expected that the application process is done online, people will be able to request this benefit at home and quickly. This will make the process efficient and easier for both insurers and employees.
5.5 No deadline
You should keep in mind that this is a measure taken so that in case an unforeseen event happens you can continue to receive an income for a period of time. Now, even if you have employment issues, you can continue to pay the policy. That is, even if you do not use it, you can keep paying it indefinitely.
5.6 It will be affordable
The unemployment insurance in the UAE will not have high prices. As a consequence, all workers residing in the UAE will have access to it. However, while this is true, a specific rate has not been yet established.
6. Other things you should know about
Because this is a recent policy, it is common that many doubts that can come into mind. While there is not enough available information to this day, we can still provide you with several important facts and answers regarding the UAE unemployment insurance policy.
6.1 A new policy
Many changes took place around the globe because of the COVID-19 pandemic. One of them is that many companies had to shut down temporarily, making it a necessity to cut costs. To achieve this, many started cutting staff. This is one of the reasons why this policy was recently created, as it intends to protect those affected.
6.2 Are employers involved?
While it is true that there is not much information on this, it is natural to ask this question. There is no clear answer yet, but there is speculation that unemployment insurance in the UAE will be provided by the company. This could be included in the employee benefits package.
6.3 When will this policy come into effect?
The UAE government created this law in May 2022. However, they specified that it will come into force by January 2023 in both the public and private sectors. This period of time is for insurers to start preparing, as well as for company owners to come to an agreement with employees.
6.4 There is no single insurer
When purchasing job loss insurance, you should make an exhaustive study of the available insurers. This will guarantee that when you go to purchase your insurance plan, you find the most suitable for you and your family’s needs. Another option is to contact a new-age insurance broker, who will provide you with the necessary information.
6.5 What documents will you need to provide?
Not much information has been published regarding this matter. Speculations say that this will be an online process. You should note that in Dubai, most paperwork procedures are carried out this way. Additionally, check out how to find a job in Dubai here. With The Talent Point, you can get the most useful advice.
6.6 The more expensive the plan, the better the benefits
When purchasing insurance, insurers will offer a variety of plans. You should look for the one that best suits your earnings. However, keep in mind that if you choose a relatively expensive plan, you can expect to receive more benefits.
6.7 A new beginning in the improvement of other labor policies
The government of the UAE has recently implemented various changes in its labor policies across the seven emirates. Not only these policies aim to attract people into the country, but also to protect the labor rights of the existing foreign population.
7. On The Talent Point, you can search for the job of your dreams
The Talent Point is one of the best options when looking for excellent job offers in the Middle East. Our mission is not only to connect professionals with the best recruiters in the region, but also to provide them with the resources and tools they need for succeeding in the job market.
If you are a professional in any field looking for an employment opportunity in the UAE, you can trust our team to assist you in anything related to the UAE’s labor laws and more. In this way, we guarantee you that this journey will be easier with the right advice.
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If you wish to learn more about our services, feel free to contact us. On The Talent Point, our representatives are more than ready to help you find the job of your dreams. Whether you are looking for IT or digital marketing jobs, you can call us at +971 43 316 688 or write us an email with all your questions at [email protected]. Finding a job opportunity in the UAE that suits your skills from your country of origin has never been easier.