UAE: Global Mobility

Unemployment Insurance Scheme in the UAE:

The Unemployment Insurance/Involuntary Loss of Employment (ILOE) scheme was introduced by the UAE Federal Government through Federal Decree-Law No. 13 of 2022 in the last quarter of 2022.

What’s new?

Mandatory registration to the ILOE scheme has been extended to employees from the free zones and semi-government entities.

This update to the scheme was made available in the ILOE website in early May 2023. Employees from the free zones and semi-government entities can register using their Emirates ID number.

Recapping the UAE's ILOE scheme

·       Eligibility

Loss of job must not be due to resignation, disciplinary action, and fraud or deceit.

·       Premium payments

Monthly basic salary of:

• Up to AED 16,000: AED 5 per month
• More than AED 16,000: AED 10 per month

·       Obligation to register and support

• Registration and payment to the ILOE scheme is the employee’s responsibility.
• Employers must inform and communicate this scheme to their employees.

·       Subscription Deadlines

• Employed before 01 Jan 2023: By 30 Jun 2023
• Employed starting 01 Jan 2023: Within 4 months

·       Penalties

• Late or non-subscription:  AED 400
• Failure to pay premiums for more than 3 months: AED 200

·       Cash Benefit

Monthly cash benefit of up to 60% of the employee’s average basic salary* shall be provided for a maximum of 3 consecutive months. The premium must be paid for at least 12 consecutive months.

*Average basic salary for the 6 months prior to loss of employment.

Note: As of the date of this update, the guidelines and circular is not yet available in the ILOE portal. 

How can Crowe help?

Assist clients and/or their employees in assessing the applicability followed by compliance with the applicable regulations.