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Overview
The United Arab Emirates (UAE) government has introduced a new insurance scheme called the Involuntary Loss of Employment (ILOE) that will be effective from January 1, 2023. The UAE Unemployment Scheme is designed to provide financial assistance to employees in both the public and private sectors who lose their jobs due to termination, for a maximum of three consecutive months per claim. The ILOE insurance aims to provide a decent standard of living for workers in the UAE if they become unemployed until they can find another job.
The Plans
There are two categories for the UAE Unemployment Scheme, Category A and Category B. For both categories subscription can be monthly, yearly or per two years.
Category A
Category A is for employees whose salary is equal or less than 16,000 AED
The subscription is either 5 AED per month or 60 AED per month or 120 AED per 2 years and all rates exclude VAT.
Category A Monthly Benefit – 60% of the average basic salary (calculated based on the average basic salary of the last 6 months preceding unemployment). Up to 10,000 AED per month. Up to 3 consecutive months.
Category B
Category B is for employees whose salary is more than 16,000 AED
The subscription is either 10 AED per month or 120 AED per month or 240 AED per 2 years and all rates exclude VAT.
Category B Monthly Benefit – 60% of the average basic salary (calculated based on the average basic salary of the last 6 months preceding unemployment). Up to 20,000 AED per month. Up to 3 consecutive months.
Compensation Benefits
- The monthly compensation under the Involuntary Loss of Employment insurance is equal to 60% of the average basic salary earned during the six months prior to the loss of employment.
- For Category A – Maximum Claim Benefits: 10,000 AED per month
- For Category B – Maximum claim Amount: 20,000 AED per month
- Maximum compensation for any one claim: 3 consecutive months
- The maximum duration for receiving benefits under the Involuntary Loss of Employment insurance is twelve monthly payments over the entirety of the insured individual’s working life in the UAE, regardless of the number of claims made
Subscription Channels
There are a number of ways that have been made available to make it easy for residents to subscribe to the UAE Unemployment Scheme.
- ILOE Online portal and App
- www.ILOE.ae
- Business Centers
- Exchange Centers
- Bank apps
- Telecommunications bill
- SMS
- Kiosks
Criteria of Eligibility
According to the Involuntary Loss of Employment (ILOE) insurance scheme’s website, in order to be eligible for compensation, the insured must meet the following criteria:
- There must be a minimum subscription period of (12) twelve consecutive months for the insured in the scheme. Provided that there is no interruption in the subscription for three consecutive months
- The Insured was committed to pay all the insurance premiums due on time
- The Insured proves that the reason of unemployment is not due to resignation
- The Insured may not be dismissed for disciplinary reasons under the Labor Relations Law and the Human Resources Law of the federal government in addition to any applicable legislation
- Submit the claim within (30) thirty days from the date of loss of the work relationship or the settlement of the labor complaint referred to the judiciary
- The Insured worker should not have an existing complaint related to the absence from work.
- The Insured shall not be entitled for compensation if there has been fraud or deceit involved in his claim or if the establishment where they work for is fictitious
- The Loss of Employment should not be the result of non-peaceful labor strikes or stoppages, whether they result in harm or not.
- The Insured must be legally present in the United Arab of Emirates
- The loss of Employment should not be the result of one of the following reasons:
- As a result of war, declared or undeclared, riot, insurrection, armed rebellion, revolution, military or usurping force, invasion, act of a foreign enemy, hostilities, civil war, or civil disorder.
- As a result of a discharge of pollutants, a nuclear event, a radioactive, toxic, explosive or other dangerous effect of any explosive nuclear equipment or part of such equipment.
- As a direct or indirect result of biological or chemical pollution resulting from or contributing to terrorism.
- As a result of a direct action by the government of the United Arab Emirates that led to the expropriation or nationalisation of the employer’s facility or the confiscation of his money leading to his insolvency
- As a result of the occurrence of force majeure in accordance with the Civil Transactions Law of the United Arab Emirates No. (5) of 1985
To learn more on how to find jobs in Dubai check this article or check this list of websites you can use to find jobs in Dubai.
