DUBAI 7 October 2018: The Ministry of Human Resources and Emiratisation announced that effective 14 October, a worker’s insurance scheme will replace the existing bank guarantees system.
The Ministry of Human Resources and Emiratisation announced that effective 14 October, a worker’s insurance scheme will replace the existing bank guarantees system. The new insurance scheme will apply to all private-sector employees, including domestic workers.
Details of the insurance scheme
Instead of a fixed amount of AED 3,000 that typically must be paid against every work permit application, employers will pay an insurance premium of AED 120 per person, for a two-year work permit. This will provide an insurance coverage of up to AED 20,000 in lieu of unpaid wages, return ticket and against work-related injuries, among other benefits.
Bank guarantee recovery
Employers will be able to recover earlier deposited bank guarantees only upon the cancellation or renewal of a work permit, and after the payment of an insurance premium. They must be free from any wages-related violations for at least six months before the renewal date of the work permit.