UAE: Government clarifies which party should pay unemployment insurance premium
Source: Middle East Insurance Review | Jul 2023
The Ministry of Human Resources and Emiratisation has clarified that the subscription fees for the mandatory unemployment insurance scheme are borne by employees working in the private sector and public sectors for both citizens and expatriates.
Employers and facility owners are not obligated to pay the premiums for their employees. The ministry said that the insured person must commit to paying the insurance premium according to the selected period of coverage and through designated channels. In the event the insured person fails to pay the insurance premiums and the premiums are in arrears for a period exceeding three months from the payment due date, the insurance policy will be cancelled and a fine of AED200 ($54.50) will be imposed.
If the insured person does not pay the outstanding fine within three months of the due date, the amount of the fine will be deducted from their salary through the wage protection system or from their end-of-service gratuity or any other alternative systems determined by the ministry.
The unemployment insurance scheme, announced in May 2022, will pay a sum in cash for three months to those whose jobs are terminated by their employers. The sum payable is calculated at 60% of the policyholder’s basic salary up to AED20,000 per month.
The unemployment insurance scheme which started in January is operated by a pool of nine insurance companies. M