The Ultimate Guide to UAE Unemployment Insurance Scheme 2023 (ILOE): Everything You Need to Know

What is the ‘UAE Unemployment Insurance scheme’?

The UAE Unemployment Insurance scheme provides economic aid to UAE nationals and expats who are employed in both the public and private sectors if they are laid off by their employers. It is designed to ensure the unemployed can still live comfortably and the country can remain attractive to the best worldwide talent by having a strong knowledge-based economy. The UAE Unemployment Insurance schem is called the Involuntary Loss of Employment (ILOE) and you can subscribe for it online, or through a total of seven different platforms.

Who is eligible for UAE unemployment insurance (ILOE) Scheme?

The UAE Unemployment Insurance schem is available to all employees in both the public and private sectors, except for people who have investments, those who independently run their own business, people employed on a short-term basis, those under the age of 18, and those who have retired and are receiving a pension from a new employer.

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Is UAE Unemployment Insurance Scheme Mandatory?

The majority of the employees in the UAE are now eligible to join the UAE Unemployment Insurance scheme, however, to be able to obtain the monetary advantages from the policy, there are 10 certain prerequisites outlined in the Article 5 of the Federal Decree-Law No. 13 of 2022 concerning unemployment insurance scheme and Article 9 of a cabinet resolution that was issued after the law was passed – Cabinet Resolution No. 97 of 2022 that must be met.
It is extremely important to ensure that you met certain conditions. The new mandatory insurance policy provides security for employees who lose their jobs due to reasons beyond their control.

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What are the conditions to claim the compensation under UAE Unemployment Insurance Scheme (ILOE)?

As per the Article the below conditions must fulfil to claim the compensation under UAE Unemployment Insurance Scheme:

• The period of subscription in the unemployment insurance scheme should not be less than 12 consecutive months.
• You must ensure you pay all insurance premiums according to the prescribed frequency.
• You must provide evidence of unemployment due to reasons other than resignation.
• You should not have been dismissed from the job for disciplinary reasons according to the applicable laws regulating labour relations in the private sector and human resources in the federal government.
• A claim must be submitted within 30 days following the termination of the employment relationship, or when the court rules on the labour complaint.
• You should not be the subject of an existing absconding report.
• In order to obtain compensation, the claim should not be fraudulent or deceitful. Similarly, the establishment where the employee works should not be fictitious.
• The compensation pay out shall cease if you are hired by another employer.
• Loss of employment may not be attributed to strikes or other non-peaceful protests, regardless of the extent of damage caused.
• It is necessary for the insured to have a legal residence in the country.

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How can you claim the Insurance under UAE Unemployment Insurance Scheme?

The Ministry of Human Resources and Emiratisation has declared that the worker who is covered by insurance must submit their application for compensation within thirty days after they become jobless.

According to Article 12, if you have applied for compensation and are eligible to receive it, the insurance provider that has been approved by The Central Bank of the United Arab Emirates must make the payment within two weeks of receiving your claim.

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How can you subscribe to the UAE Unemployment Insurance Scheme?

The UAE offers various avenues for individuals to subscribe to the mandatory Unemployment Insurance Scheme (ILOE). These options ensure accessibility and convenience for residents in the country.

Below are the Five Methods to Enroll in the Mandatory Unemployment Insurance Scheme in the UAE:

1. Direct Channels – ILOE Website and App: The ILOE portal and mobile application, available for both Apple and Android devices, allow individuals to directly apply for the unemployment insurance scheme. Managed by Dubai Insurance, these platforms enable free sign-up for the insurance plan.
2. Exchange Centers: Al Ansari Exchange currently provides the option to subscribe to and pay for the ILOE insurance. By visiting any of their branches, individuals can follow these steps:
   • Present their Emirates ID.
   • Provide their mobile number.
   • Request the ILOE insurance form.
   • Select the policy period (one or two years).
   • Choose the payment option: monthly, quarterly, semi-annual, or annual. After payment, individuals will be officially enrolled in the scheme and receive a receipt as confirmation.
3. Kiosks: Through kiosk machines, individuals can also subscribe to the ILOE scheme. The official subscription channels in the UAE are MBME Pay and uPay. These kiosks have numerous locations across the country, easily locatable using online map applications.
4. Bank Mobile Applications: The C3Pay app and card, offered by Edenred, a Wage Protection System (WPS) agent authorized by the Central Bank of the UAE, provide an option for subscribing to the unemployment insurance scheme. Users with a C3Pay card or account can directly enroll through the C3Pay mobile application, available for Apple and Android devices.
5. Tawjeeh and Tasheel Centers: At Tawjeeh and Tasheel service centers, operated by the Ministry of Human Resources and Emiritisation (MOHRE), individuals can also subscribe to the ILOE scheme. By providing their Emirates ID and mobile number, they can enroll for the scheme. To find a nearby MOHRE service center, individuals can visit the MOHRE website.

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How is the insurance pay out calculated under UAE Unemployment Insurance Scheme?

According to MOHRE, the insurance coverage compensation is calculated on a monthly basis at the rate of 60 per cent of the basic salary and the compensation salary is given for a maximum of three months from the date of unemployment.

The insurance scheme is divided into two categories:

1. Category A
2. Category B

Category A:

• Employees who are earning a basic salary of Dh16,000 or less.
• Insurance cost: Dh5 per month (or Dh60 annually)
• Monthly compensation: 60 per cent of your basic salary, up to Dh10,000

Category B:

• Employees earning Dh16,000 and above
• Insurance cost: Dh10 (or Dh120 annually)
• Monthly compensation: 60 per cent of your basic salary, up to Dh20,000

According to the Ministry of Human Resources and Emiratization, those who are employed and compensated through commission can also be a part of the scheme. The cost of the insurance is either five dirhams or ten dirhams (AED 10) each month, based on the category, which can be paid either on a monthly, quarterly, bi-annual, or yearly basis.

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What are the entities that provide Insurance Policy?

There are 9 national insurance companies under the Dubai Insurance Company that provides Insurance policy. They are:

1. Dubai Insurance Company : https://www.dubins.ae/en/
2. Abu Dhabi National Insurance Company : https://adnic.ae/
3. Al Ain Ahlia Insurance Company : https://alaininsurance.com/en-us/home/
4. Emirates Insurance Company : https://www.eminsco.com/
5. National General Insurance Company : https://ngi.ae/
6. Orient Insurance : https://orientonline.ae/
7. Abu Dhabi National Takaful Company : https://takaful.ae/en/
8. Oman Insurance Company : https://www.sukoon.com/
9. Orient UNB Takaful Company : https://www.orienttakaful.com/

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What do you do if you cannot subscribe to the UAE Unemployment Insurance Scheme?

If you are unable to subscribe to the unemployment insurance scheme you can raise your issue directly with the Ministry of Human Resources and Emiratisation (MOHRE), as per a notification on the subscription website.

If you are subscribing to the insurance scheme through the Involuntary Loss of Employment (ILOE) website – iloe.gov.ae – applicants are now being provided the following notification:

1. Private Sector Employees: If you are employed in the private sector and have received a work authorization from the Ministry of Human Resources and Emiratisation (MOHRE), but your information is not showing up when inputting your data, you should generate a technical support ticket on the MOHRE website or mobile application, or you can contact the MOHRE call center.
2. Federal Government Employees: When you enter your data, if you do not find your information, please contact the Human Resources Department in the entity where you work.
3. Free Zone Employees: If you are an employee in a free zone please note that workers in free zones are not currently covered by the unemployment insurance product (ILOE).

It is important to note that the deadline for subscription to the mandatory scheme is June 30, 2023.

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How to raise a technical support ticket with MOHRE?

You can request a support from:

1. Call Centre 600590000
2. Visit the MOHRE website mohre.gov.ae and click on the ‘Contact us’ option in the top menu. Enter your details in the form provided and click ‘submit’.
3. Email [email protected]
   

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Can employer sign you up for the mandatory UAE Unemployment Insurance Scheme?

Employers can register their workers to the scheme, but they will not pay for the subscription. The cost is borne by the employee.

As per Federal Decree-Law No. 13 of 2022 and its resolutions, it is mandatory for all employees in the UAE’s federal and private sectors to sign up for the unemployment insurance scheme before the June 30 deadline to avoid fines.

However, according to the Involuntary Loss of Employment (ILOE) scheme call centre – 600 599 555, an employer can only sign up their employees for the insurance policy if there is a mutual agreement between the parties. The cost of the insurance, however, needs to be borne by the employee, as per the law.

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How to apply for the UAE Unemployment Insurance Scheme Online?

How do the employer register their employees for the UAE Unemployment Insurance Scheme?

The website belonging to ILOE, found at iloe.ae, offers employers a distinct log in portal in order to register their workers for the insurance coverage.

• Visit the website – www.iloe.ae – and click on ‘Subscribe. You will then be redirected to the log in page, where you will see two options:
  • Individual
  • Company
• To log in, you will have to input your establishment card number and the personal number that is featured on the e-signature card given to you by the company. Generally, the Human Resources (HR) department, the administrative office, or the Public Relation Officer (PRO) have access to the establishment card and the e-signature card information.
• Once you have logged in using your establishment details, you will then be able to sign up the company’s employees for the scheme.

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How do you (an Employee) register for the UAE Unemployment Insurance Scheme?

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How does an employee know they are enrolled in the UAE Unemployment Insurance Scheme?

When the registration is finished, the worker will be required to pay a premium for their insurance depending on which category they fall under. The employee can choose to pay on a monthly, quarterly, semi-annual or yearly basis. Value-added tax (VAT) will be included in the sum of the insurance policy. Upon completing the payment, the worker will be issued with a certificate of insurance. This document serves as evidence that the employee is signed up to the scheme and also serves as a reminder to the employee that they must pay their instalments on time.

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6 things to know about the mandatory UAE Unemployment Insurance Scheme:

Subscription to the UAE’s new joblessness protection strategy is compulsory, and private sector and federal government workers have until June 30 to enroll in the Involuntary Loss of Employment (ILOE) insurance. However, it is preferable not to wait until the last minute as the time you register for the insurance will have an impact on when you will be able to get the payment in the event that you are laid off. The following are six things to keep in mind regarding ILOE.

1. To take advantage of this offer, you must be a subscriber for a period of twelve months.
2. For a duration of three months, you are eligible to receive up to 60% of your standard wage. However, there is a maximum amount that you are eligible to receive, so it is important to be mindful of this.
3. There will e no compensation for workers if: dismissed for a disciplinary reason, or resigned.
4. You will not continue to receive the payout if you find a new job within three months.
5. It is applicable only if you are staying in the UAE : “It is necessary for the insured to have a legal residence in the country.”
6. The claim has be honoured in two weeks.

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What are the fines and penalties for not subscribing UAE Unemployment Insurance Scheme or complying with the ILOE Policy?

As per the Articles 9 and 10 of the Ministerial Resolution No. 604 of 2022, regarding Unemployment Insurance Scheme,  the fines and penalties for not subscribing or complying with the ILOE policy  are of two types 

1. Failure to subscribe to the scheme: AED 400 fine will be applicable if you do not subscribe to the Unemployment Insurance Scheme after the deadline, which is June 30.
2. Failure to pay insurance instalment on time: A penalty of AED 200 will be imposed if you have subscribed to the scheme but have not paid the premiums according to the selected payment frequency (monthly, quarterly, semi-annual or annual) for a period exceeding three months from the due date.

Note:

1. According to clause 4 of Article 9 of the resolution, an employee who fails 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 (WPS), or end-of-service gratuity.
2. As per Article 10 of the resolution, if there are fines resulting from non-subscription or non-compliance with the ILOE scheme – the employee will not be eligible for a new work permit.

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What happens to UAE Unemployment Insurance Scheme when You change or switch the job?

The ‘Cabinet Resolution No. 97 of 2022, provides details of the conditions under which the employee is protected from income interruption in the event of loss of work.

The Job change will not required the insured to cancel their current subscription and subscribe to a new insurance policy as long they adhere to the general conditions for subscription stipulated in the ministerial decision. However, for change in place of employment, the insured would be required to provide the Insurance Authority with the updated new permit card information.

You also would need to pay the difference premium amount in case if you move your Job category A to the Job category B within the scheme.

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How Freezone employees can register for UAE Unemployment Insurance Scheme in the Dubai?

Freezone employees and those working for semi-government entities in the UAE can now apply for the Involuntary Loss of Employment (ILOE) or Unemployment Insurance Scheme. The scheme provides eligible workers with a salary equal to 60% of their basic salary for up to three months in case of job loss. 

To register for the scheme as a freezone or semi-government employee, follow these steps:

1. Go to www.iloe.ae and click on the ‘Subscribe Here’ button.
2. You will be redirected to the ILOE application portal. Under the ‘Individual’ category, select the ‘non-registered in MOHRE’ option.
3. Enter your Emirates ID or UID number, as well as your mobile number, and click ‘Request OTP’ (One-time password).
4. Enter the OTP you receive to access your ILOE dashboard, where you can select your ILOE plan and pay the premium on a monthly, quarterly, semi-annual, or annual basis. 

The insurance cost and monthly compensation depend on two categories:

Category A includes employees earning a basic salary of Dh16,000 or less, with an insurance cost of Dh5 per month or Dh60 annually, and a monthly compensation of 60% of the basic salary, up to Dh10,000.

Category B includes employees earning Dh16,000 and above, with an insurance cost of Dh10 per month or Dh120 annually, and a monthly compensation of 60% of the basic salary, up to Dh20,000.

For any further details you may contact Dubai Insurance (authorised insurer to issue the ILOE policies on behalf of the ILOE Insurance Pool). You can reach out to them through email – [email protected] – or by calling 600 599 555.

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How Can Free Zone Companies Sign Up Their Employees?

Companies can do this for their employees by following these steps:

Send copies of their trade license and a request letter to [email protected].

Required documents

• Trade licence copy of the company.
• Request letter to enroll workers on their behalf.

How Much Does It Cost for Employees?

Once the company signs up their employees, the workers need to pay for the insurance. The cost depends on the type of job they have. They can pay every month, every three months, every six months, or once a year.

After they make their first payment, they will get a certificate as proof that they are in the scheme. The certificate also says it’s the employee’s job to make sure they pay for the insurance on time.

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Deadline for Signing Up: October 1

The deadline to join the Unemployment Insurance Scheme used to be July 1, but it has been extended to October 1, 2023. However, if you started working after May 30, 2023, you must sign up within four months of your employment start date.

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How to Sign Up for the UAE Unemployment Insurance Scheme via Phone?

Signing up for the UAE Unemployment Insurance Scheme is a straightforward process that can be completed in just a few minutes, either online or via phone. Here are the step-by-step instructions to help you quickly enroll in the Involuntary Loss of Employment (ILOE) insurance scheme.

• Step 1: Contact the ILOE Call Centre – Dial 600 599 555 Before making the call, gather essential details such as your labor card number and Emirates ID number. These will be required by the call centre, along with additional information listed below.
• Step 2: Provide Contact and Employment Information : When connected to an agent, provide the following details:
  • Mobile number
  • Email address
  • Emirates ID number
  • Full name (as per Emirates ID)
  • Date of birth
  • Labor card (work permit) number, which can be found through the MOHRE mobile app or by contacting your employer or relevant free zone authority.
• Step 3: Select Payment Frequency and Category Based on your basic salary, you will be categorized as A or B. The agent will inform you of the insurance premium and compensation percentage based on your category. Select your payment frequency (monthly, quarterly, semi-annually, or annually) for the insurance premium.
• Step 4: Make the Insurance Payment After selecting the payment option, the agent will provide you with payment details. You will receive an email with insurance and payment information, including a link to the ILOE payment portal. Follow the link and enter your credit or debit card details to complete the payment.
• Step 5: Obtain the Insurance Certificate Upon successful payment, you will receive a confirmation email from ILOE insurance. Download and keep the insurance certificate as proof of your enrollment in the scheme. It is your responsibility to ensure timely payment of insurance installments.

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UAE’s Unemployment Insurance Scheme: Key Points to Remember

1. Subscription Deadlines Vary:
   • If you’re employed in the UAE’s federal government or private sector, subscribing to the Unemployment Insurance scheme is essential before October 1, 2023. However, your deadline might differ based on your employment contract date. Those with contracts before May 30, 2023, must register by September 30, 2023. For employees starting work after May 30, 2023, registration must occur within four months from their employment start date.
2. Secure Insurance Benefits:
   • Paying your insurance premium on time is crucial. Missing premium payments, coupled with involuntary job loss, could lead to rejection of Unemployment Insurance benefits. Ensure you comply with the payment schedule to safeguard your eligibility for compensation.
3. Eligibility for Compensation: To claim Unemployment Insurance benefits, meet these nine criteria:
   • Maintain 12 consecutive months of insurance subscription.
   • Fulfill insurance premium payment commitments.
   • Provide proof of job loss unrelated to your resignation.
   • xAvoid job dismissal due to disciplinary reasons.
   • File a claim within 30 days post-employment termination or labor complaint resolution.
   • Absence of an absconding report against you.
   • Ensure your claim is honest and your workplace is legitimate.
   • Loss of employment due to peaceful circumstances, not strikes.
   • Possess legal residence in the country.
4. Calculating Your Payout:
   • Understanding your potential payout is important. If your monthly salary, including allowances, is Dh15,000, with a basic pay of Dh10,000 on the MOHRE contract, you can claim 60% of your basic pay, which amounts to Dh6,000, as per the Unemployment Insurance scheme. However, fulfilling the conditions listed under Article 9 of the Cabinet Decision of 97/2022 is necessary for eligibility.

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Checking and Settling UAE Unemployment Insurance Scheme Fines (ILOE):

If you missed the October 1 deadline for Involuntary Loss of Employment (ILOE) enrollment or skipped scheduled installment payments, you may face fines ranging from Dh200 to Dh400. It is crucial to make timely payments, as failure to settle may lead to severe repercussions.

This includes the withholding of work permits and potential deductions from salaries or end-of-service gratuities.

Late Enrollment Penalties: Acting within Four Months

If you joined a job after the October 1 deadline, strict adherence to the job loss insurance scheme is required within four months to avoid a Dh400 fine. The Ministry of Human Resources and Emiratisation (MoHRE) rigorously enforces this requirement. It is essential to act promptly to ensure compliance and avoid financial penalties.

Checking and Paying Fines with ‘ILOE Quick Pay’

To check and pay fines efficiently, use the ‘ILOE Quick Pay’ service on the MOHRE app or website. Follow these steps:

• Download the MOHRE app and sign in with your UAE Pass.
• Choose the ’employee’ category and enter your labor card number.
• Access the ‘ILOE Quick Pay’ service and enter relevant details (Emirates ID, UID No., Labor card number, or personal code number).
• Check fines and pay online or in instalments using credit or debit cards.

In-Person Payment and Fine Waiver Option

If you prefer in-person payment, visit authorized business service centers listed on www.mohre.gov.ae. Additionally, you can apply for a fine waiver through ‘ILOE Quick Pay’ by submitting supporting documents. MOHRE will inform you of their decision within 15 working days.

Understanding Fines and Penalties

Fines and penalties, outlined in Ministerial Resolution No. 604 of 2022, include:

• Dh400 fine for failing to subscribe to the scheme.
• Dh200 penalty for delayed payment of insurance instalments exceeding three months.
• Deduction of unpaid fines from wages or end-of-service gratuity through the Wage Protection System (WPS) after three months of non-payment.
• Ineligibility for a new work permit if fines from non-subscription or non-compliance exist.

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Frequently Asked Questions FAQs on UAE Unemployment Insurance Scheme: