Over 250,000 workers opt for unemployment insurance in UAE, two weeks after launch

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Over 250,000 employees in the UAE have subscribed to the unemployment insurance since its launch two weeks ago.

The program, which came into effect this year, aims to temporarily guarantee a monthly amount to public and private sector employees in the event of unexpected unemployment.

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About 86 percent of the subscribers have chosen an annual payment of the premium while six percent have chosen to pay once every six months, the Emirates News Agency reported on Friday.

About four percent of the subscribers have chosen the quarterly payment, and the remaining four percent have opted for the monthly payment option, the same report said.

The payment is given out for a maximum of three months. To qualify for the payment, the employee must have been insured for a minimum of 12 months.

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 the 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 the insurance. Monthly compensation in this category will not exceed $5,440 (AED 20,000).

The compensation amount upon job loss can be claimed at 60 percent of the basic salary.

Employers are not required to bear the cost of subscribing to the unemployment insurance but can choose to do so.

The UAE cabinet approved the scheme in May to provide unemployment benefits as part of a larger job security initiative launched by the government.

Gulf states Qatar, Oman, Kuwait and Saudi Arabia have provided some form of unemployment support to citizens while Bahrain also has a form of jobless insurance for resident non-citizen workers.

Permission to reside in Gulf countries like the UAE has traditionally been tied to employment. Under recent reforms, UAE residents whose visa is canceled can remain for up to six months versus 30 days previously.

The changes come as part of the UAE’s wider vision to attract and retain talent in the country.

Read more:

Everything you need to know about the UAE’s new unemployment insurance scheme

UAE workers must opt-in for unemployment insurance from 2023, costs revealed

Dubai sets $8.7 trillion economic plan for next decade

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