A job loss insurance scheme took effect on January 1, 2023 in the UAE, and many companies have registered their employees for it. The government made enrolment in the Involuntary Loss of Employment (ILOE) insurance program mandatory for federal and private sector employees, and failure to enrol by June 30 will result in a Dh400 fine for the workers.
Reportedly, the ILOE scheme provides eligible employees with a monthly cash benefit of up to 60 per cent of their average basic salary from the 6 months prior to losing their job.
Furthermore, the scheme consists of two categories: Category A, where employees with a basic salary of Dh16,000 or less, are required to make a monthly payment of Dh5 plus VAT and they will be provided a monthly compensation of up to Dh10,000 for 3 months. Category B, where the employees earning over Dh16,000, are required to make a monthly payment of Dh10 plus VAT and they will be given a monthly compensation of up to Dh20,000 for 3 months.
Additionally the employees to be eligible for the scheme must also be a legal resident of the UAE.
As reported by Khaleej Times, Dana Kansou, manager of strategic partnerships, Dubai Insurance, stated, “A significant amount of companies have registered their employees for the Involuntary Loss of Employment (ILOE) scheme. Additionally, companies have a duty to educate their employees about the ILOE scheme, and Dubai Insurance is leading the initiative on behalf of the ILOE pool in the country.”
Kansou also recommended that companies should frequently remind their employees to subscribe to the ILOE scheme in order to avoid penalties.
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