UAE: New migrant worker inclusive unemployment scheme falls under Kafala as certain groups incl. domestic workers remain excluded
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The UAE Government has proposed a new unemployment scheme that is both inclusive and accessible to local and migrant workers with annual instalments ranging between USD40 and USD100. The scheme is to go into effect starting January 2023 and is to be mandated by private insurance companies, with pay outs of up to DHS20000 (USD 5445) per month.
“Typically, government-helmed unemployment insurances tend to have stringent conditions, favouring citizens and employees...The UAE’s scheme, however, covers expats and citizens alike. With proposed fees as low as Dh40 and payouts up to 60 per cent of base salaries, the stipulations are policy-holder friendly. This will create a stable labour market”Anselm Mendes, Executive Director of Sales & Technology at the Continental Group
Rights groups expressed concerns around the efficacy of the unemployment scheme under the Kafala system, and particularly how migrant workers who are dependent on employer's sponsorship for their legal stay in the country would be disproportionately unable to reap the benefits of this scheme as the current grace period for those who have lost their sponsorship stands at 30 days. Other groups such as domestic workers are completely excluded from this scheme.