Expats in the UAE welcome 2023 filled with optimism as the country ushers in the implementation of the Unemployment Insurance scheme, which will help hundreds of thousands of expats to secure funding in case they lose their jobs.
Since its implementation on January 1st, the program witnessed 60,000 employees sign up successfully, including several OFWs. Among them was Mike Siapno, a nurse based in Abu Dhabi, who stated that it was fast and easy to do.
“Una ko pa lang nabasa ang unemployment insurance na ito, ay dali dali na ako nag register agad at within first 2 days kasama ako sa unang 60,000 na nag register. Maganda ang maging benepisyo nitong tinatawagan na Unemployment Insurance Dito Sa UAE,” said Siapno.
He added that as the sole breadwinner of his family, it would help him in case he loses his job unexpectedly: “Malaking tulong po ito sa iba’t ibang lahi. Kapag nawalan ng trabaho ay may inaasahan kang pera na magagamit sa pag aaply hanggang makahanap ng bago.”
Of the participants who registered in the first two days, 86% chose to do so via the Dubai Insurance Company website, with the remainder using self-service kiosks, businessman service centers, Al Ansari Exchange, bank smartphone applications, and telecom bills.
The unemployment insurance program is being run by the Dubai Insurance Company, and offers seven subscription channels: the website, a smart app, kiosk machines, businessman service centers, Al Ansari Exchange, bank ATMs and applications, and telecom bills. The program is designed to be low-cost, with no additional costs for employers, and offers a safety net for employees during their professional journey, providing them with career stability.
Compliance required
Joy Distor, an HR professional for nearly three decades, advised fellow Filipinos that they should meet and beat the deadline of registering for the unemployment insurance which is by June 30, 2023.
“This type of insurance is a personal investment to protect us, individuals, from loss of a job that is not attributable to you,”
She also stated that while employers don’t have to pay for anything since employees themselves have to register for the program, this creates several indirect benefits in the long run.
“If employers analyze the positive notes like developing and retaining talents; then businesses create job security, which means no redundancy, no position streamlining, no resignations, and no terminations, which eventually equates to business viability. If the company is in good shape, there will be more opportunities for job creation and competition for retaining employees,” said Distor.
This is what Marilou De Guzman did. As a single parent living in Abu Dhabi for over two decades, she took action immediately and paid for the whole year.
“60 dirhams is not that much compare to the benefits in return. With the global crisis happening in the world, there is no assurance of our employment anymore, and this unemployment insurance scheme will help / support us in case of termination and/or unemployment. It will help the expats to cover expenses i.e flat rentals, food and other cost while searching for another job. I have been in the UAE for 20 years, and I have experienced its highs and lows. So better to be safe than sorry,” said De Guzman.
For his part, Atty. Imran Khan said that this would help Filipinos who might find themselves in between jobs if they were terminated unexpectedly.
“In severe circumstances, employee might be terminated by their employer as part of downsizing. In tough situations like this, the unemployment insurance scheme comes as a beneficial program for them. Many of them avoid travelling to the Philippines in this situation they can be assured of 3 months of financial stability. UAE government recently also extended a grace period after visa cancellation in this situation this scheme will be very useful to them,” said Atty. Khan.
Atty. Khan assured Filipino expats that the mandated monthly or even annual payment should be their sign to opt for the insurance program that stands to help them should they face job loss.
“They should all take advantage of this scheme as soon as possible to get themselves insured in case of sudden unemployment – considering that they need to have at least paid for a year before they benefit from this scheme. Through this program, a person gets financial security while he is without a job and uses a grace period to find better employment after payment of a small amount,” advised Atty. Khan.
Extensive guidelines
To be eligible for the benefit, an individual must be subscribed to the scheme for at least 12 consecutive months. However, the person forfeits their right to the claim if they leave the country or accept a new position. There are several categories of people who are exempt from the scheme, including investors or owners of establishments, domestic workers, temporary contract workers, juveniles under 18, and retirees who receive a pension and start a new job.
To make a claim, individuals must submit it through the designated channels: the Dubai Insurance Company website, the smart app, or the call center. Claims must be made within 90 days of the termination of services, and compensation will be paid within two weeks of the claim date. Premiums can be paid quarterly, monthly, semi-annually, or annually.
If an employee does not resign or is not fired for disciplinary reasons, the insurance will pay them a sum for a maximum of three months. The pay is calculated based on 60% of the basic salary in the last six months before becoming unemployed.
The implementation of the unemployment insurance program is just one of the measures that the UAE government has taken in recent years to improve job security and financial stability for its citizens and expat workers. With the COVID-19 pandemic causing widespread economic disruption, the availability of this insurance provides a much-needed safety net for those who may find themselves out of work. By requiring private sector employees to register for the insurance, the UAE government is taking a proactive approach to protecting its workforce.
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FAST FACTS: UAE’s unemployment insurance program
Federal Decree Law No. 13 of 2022, otherwise known as the Unemployment Insurance Scheme aims to create a low-cost job safety net that supports employees in their professional journey, providing them with career stability at no cost to employers.
Subscription to this scheme is mandatory for all public and private employees, except for those working in the free zones as well as for investors – owners of establishments in which they work, domestic workers, temporary contract workers, juveniles under 18 years, and retirees who receive a pension and joined a new job.
Employees who fail to subscribe to the scheme within the prescribed deadline will be subject to a fine of AED 400.
Those who fail to pay the insurance premiums for more than three months from the due date will be subject to a fine of AED 200, their insurance certificate will be cancelled and the individual will not be eligible for a new work permit.
The deadline to register for the scheme is this coming June 30, 2023.
VOX POP: OFWs commend UAE’s protective unemployment insurance scheme
“In general, I really like the scheme because it is very affordable and provides assistance to the expatriates who are residents in the UAE (not limited to OFWs) when they lose their jobs as a result of termination. For us, Global Filipinos/OFWs, it is such a big help because when you lose your job, you will get a monthly stipend or allowance which you can use to support your needs and still provide for your family while you are looking for a job. It gives that security and level of comfort while seeking other opportunities,”
“Kapag nawalan ka ng trabaho, may inaasahan kang pera na magagamit sa pang araw araw na pambili ng pagkain, pambayad ng bahay at iba pa. At higit sa lahat may pera kang magagamit sa pag-aaply para makahanap ng bagong trabaho,”
“Employment these days has no guarantee. At any moment, you can find yourself unemployed as it can happen to anyone. Employees risk being laid off, and they most often are unprepared – resulting in frustrations and stress. With the UAE Unemployment Insurance, it would provide a lot of difference. It would boost the morale of finding a new job while providing financial support to the family and relatives back home. This is a brilliant idea! I would definitely support and recommend this to every OFW!”
“The newly implemented unemployment Insurance Scheme dito sa UAE is only applicable to those employees who lost their employment in some specific cases like retrenchment, company cost-cutting and other force majeure related causes. Sana magkaroon pa ng further review and batas na ito which is beneficial to the majority,”
“This will benefit those people na mawawalan ng work. Pero, it depends pa din sa reason of losing your job. As OFWs, we have to abide by the law and rules of UAE,”
“Maganda ang nakikita kong layunin ng gobyerno sa pag papatupad ng bagong scheme na ito sa kadahilanang napaka unpredictable ngayon ng employment sa bansa. Makakatulong ang scheme na ito para sa mga kapwa expat na nawalan ng trabaho na nangangailangan,”
“Bilang isang single parent at breadwinner ng aking pamilya, malaking bagay ito lalo na sakaling mawalan ka ng trabaho. Sa hirap ng buhay ngayon at sa taas ng presyo ng bilihin, inaayos ko lang ang papeles ko para makapagregister na ako sa programang ito,”
“The day I heard the news I immediately registered and paid for the whole year. AED60 is not that much compared to the benefits in return. With the global crisis happening worldwide, there is no assurance of our employment anymore, and this unemployment insurance scheme will support us in case of termination and/or unemployment. It will help expats to cover expenses i.e flat rentals, food and other costs while searching for another job. I have been in the UAE for 20 years and I have experienced its ups and downs. So better to be safe than sorry,”
Malaking tulong ang ILOE insurance lalo na kung wala kang funds sakaling mawalan nang work.
