The Ministry of Human Resources and Emiratization announced on Wednesday, October 3, that the currently mandatory Dh3,000 bank guarantee deposit per worker will be abolished and will be replaced by an annual Dh60 insurance per worker starting this month.
With the new system, the price of hiring household service workers (HSWs) in the UAE is also expected to become cheaper once the new insurance scheme is implemented, reported Gulf News.
The insurance policy will cover end-of-service benefits, vacation and overtime allowance, return air ticket, unpaid wages, and cases of work injury.
The insurance will also cover the cost of replacing the worker for health reasons or if the domestic worker wants to cancel the work relationship with employer. The total amount covered by the insurance is Dh20,000.
MOHRE will begin disbursing the bank guarantees paid earlier by private employers amounting to Dh14 million starting October 15. Those who had salary-related violations six months before work permit renewal, however, would not be able to reimburse their bank guarantees.
The insurance scheme was one of the new laws approved by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, in June.
“Our goal is to remain a top destination for ease of doing business, through an agile economy based on flexibility and openness,” the UAE Vice President said in June.
