Employees who don’t pay the penalties will not be eligible for new work permits
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[Editor’s note: This article was originally published in January 2023, but as the mandatory subscription deadline approaches, KT wants to keep our readers informed of the scheme, fines and payment modes]
Subscribing to the UAE’s unemployment insurance scheme is a mandatory requirement for all employees of federal government departments and private sector companies. Subscription to the scheme started on January 1, 2023. Employees will have to subscribe to a scheme before June 30, 2023, failing which they will be fined Dh400.
A ministerial resolution details how the fines will be collected. Under ‘fines and collection methods’, the ministerial resolution states: “Workers/employees who fail to pay their fines for three months from the due date will have the fine amount deducted from their wages through the Wage Protection System, end-of-service gratuity, or any other alternative method deemed acceptable by the Ministry (of Human Resources and Emiratisation).”
Another article in the resolution states that the employee will not be eligible for a new work permit until all due fines are paid “within the specified timeframe”.
Employees can pay the fines via the MOHRE website, app and ministry-approved business service centres. They can also apply for paying through installments or request a waiver via the same channels.
In order to be eligible for compensation, employees must have been subscribed to the scheme for at least 12 consecutive months. This means employees who sign up for the scheme in January 2023 will become eligible for compensation in the event of job loss in/after January 2024.
Spearheaded by the MoHRE, the insurance scheme has ultra-low monthly premiums that range from Dh5 to Dh10, with the insured getting 60 per cent of their basic salaries for three months in the event of job loss for reasons other than disciplinary action or resignation.
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