Securing jobs has become a more important goal in recent years across the world, under the impact of the COVID-19 pandemic.
In May, the UAE announced the creation of a compulsory unemployment insurance system that will provide financial support to workers in the public and private sectors. It will come into effect at the beginning of 2023.
“The benefits will be available to all Emirati workforce – whether they are Emirati nationals or foreign residents – and different skill levels,” Explained by Abdul Rahman Al Awar, Minister of Human Resources and Emiratisation.
“It fits with the nature of the UAE labor market in that it is very open, very dynamic and very attractive,” believe before adding: “We are implementing reforms and policies that will allow people who participate in this labor market to benefit from social security policies that provide them with safety nets against the difficulties they may encounter working here.”
This legislation aims to achieve greater financial stability for workers and their families. “This new labor law is a positive change,” Judge Aaron Portero, Managing Director of Connect Resources. “This change will give us more work because we will also have to adapt to manage the pension system and comply with the legislation,” He said. “But our top priority,” continue, “As always, managing several thousand employees and trying to take care of all of them. These changes will be positive for us, customers and employees.” Confirms.
For workers, unemployment insurance fees should be between 10 and 25 euros per year for basic coverage. The system provides for a payment of 60% of the basic salary – up to a maximum of 5,000 euros per month – in the event of a job loss for a specified period. Investors, home workers, people on temporary contracts, employees under 18, and retirees are excluded from this system.
“We will have a system that will not be a burden to the participants,” Minister Abdul Rahman Al-Awar says. “It will be available digitally and it will be very simple: participation will be through a digital process that requires no steps,” Identifies.
To stay and live in Dubai, you must have a valid residence visa associated with your professional status. Under current rules, expats who have lost their jobs have a few months to find a new one. Otherwise, they risk going back to their country.
Andrew Wingrove has been living in Dubai for the past 18 years. The group manager at Motivate Media Group explains that he has been generally fortunate in his career there, even if his dismissal a few years ago was a stressful time for him.
“The cost of living here is higher than in the UK: education is completely private and if you don’t have a salary you can’t keep, you can’t pay your rent, your villa or your family expenses” He indicates.
“So anything that can bridge the gap between one job and another is perfect, it’s reassuring; when you know you have that safety in case things go wrong, it protects us from panicking and wondering if you should leave the country,” He adds.
Attracting and retaining the best talent
This new legislation, along with recent reforms to immigration and labor laws, will bring fundamental changes to the labor market.
“The UAE clearly sees the value of attracting foreign talent who continue to contribute to the development of the country,” Remember Ludmila Yamalova, Managing Partner at HPL Yamalova & Plewka. “So even outside the pandemic, I think every country wants to make sure that they can attract the best talent — and in that respect, not just attract them, but retain them —: so, obviously, you have to put protection and benefits in place for those who work, so they want stay,” indicate.
The unemployment insurance scheme aims to provide greater long-term security for workers and employers, but also to enhance the competitiveness of the local labor market.