Employment insurance in the UAE is mandatory for most employees. By 2025, over 7 million workers will have enrolled in the ILOE scheme (MOHRE). It offers up to 60% of your basic salary for three months after job loss. Fees range from AED 5 to AED 10 monthly, depending on salary. Missing registration by the deadline leads to an AED 400 fine. Both public and private sector workers must subscribe through the ILOE portal or app.
What Is Employment Insurance in the UAE?
Employment insurance in the UAE is a mandatory system that helps workers after job loss.
- Covers workers in private and government sectors
- You get monthly cash support for up to three months if you’re laid off.
- But you must register and pay a small monthly fee, starting from AED 5.
- The maximum payout can reach AED 20,000, depending on your salary.
- The law was introduced under Federal Decree-Law No. 13 of 2022
- You must apply within 30 days of losing your job
- Most workers are covered, except domestic helpers and business owners
This program reduces stress, gives you time to find new work, and keeps the UAE job market stable.
Who Must Subscribe to Employment Insurance in the UAE?
In the UAE, most employees must register for the employment insurance scheme. This system protects workers in case of job loss. However, not all categories are required to join. Below is a clear breakdown of who must subscribe, who is exempt, and key conditions you need to know.
Who Must Subscribe?
- All UAE nationals working in the private sector
- Emiratis employed in the federal and local government
- Expatriates with valid UAE work permits
- Employees in free zones, unless excluded by internal rules
- Workers under fixed or unlimited contracts
- New hires, including those under probation periods
Important Conditions
- You must subscribe within 4 months of your start date
- Payments can be made monthly or quarterly
- Coverage is linked to your Emirates ID, not your company
- Employers must ensure their staff are registered on time
- If you’re a freelancer, you can join voluntarily
Who Is Exempt?
- Domestic workers, including drivers and nannies
- Investors or business owners with residence visas
- Employees under short-term contracts (less than 1 month)
- Juvenile workers under 18
- Retirees with a pension who rejoined the workforce
Subscription Requirements for Employment Insurance in the UAE
| Category | Required to Subscribe? | Details |
| Private sector employees | Yes | Must register within 4 months |
| Government employees | Yes | Federal and local levels |
| Free zone workers | Depends | Based on the free zone policy |
| Self-employed (freelancers) | Optional | Can register voluntarily |
| Domestic workers | No | Fully exempt |
| Investors / Business owners | No | Not covered if no work permit |
| Short-term contract workers | No | Less than one month |
| Juveniles under 18 | No | Not eligible |
| Retired residents with new jobs | No | Already receive pension |
To stay compliant in the UAE, make sure you know your employment category and subscribe on time. Missing the deadline can lead to fines and loss of benefits. Check your status and register if required.
How Much Does Employment Insurance Cost per Year in the UAE?
The cost of employment insurance in the UAE is simple, fixed, and linked to your basic salary. Workers can pay monthly, quarterly, semi-annually, or yearly. Therefore, you always have flexibility in managing payments. The system is divided into two salary categories, making it easy to understand.
Annual Cost Breakdown for UAE Employment Insurance
| Salary Range | Monthly Fee | Yearly Fee | Maximum Monthly Payout |
| Less than AED 16,000 | AED 5 + VAT | AED 60 + VAT | Up to 10,000 AED |
| Above AED 16,000 | AED 10 + VAT | AED 120 + VAT | Up to AED 20,000 |
Key Payment Rules
- Payments are linked to your Emirates ID.
- You must subscribe within 4 months of starting work.
- You can pay monthly, quarterly, or yearly.
- The cost is the employee’s responsibility, not the employer’s.
- Benefits stop if payments are delayed.
What Else You Should Know
- The scheme covers both Emiratis and expats.
- Investors, domestic workers, and minors under the age of eighteen are exempt.
- Late payments may result in fines starting from AED 400.
- Coverage begins once the first payment is confirmed.
- Self-employed workers can join voluntarily.
This cost structure is fair and predictable. Because the system is low-cost yet supportive, it helps workers stay financially secure during unemployment. Therefore, employment insurance in the UAE is both practical and reliable for long-term stability.
UAE Employment Insurance Benefits and Calculation Method
The UAE’s Involuntary Loss of Employment (ILOE) scheme, established under Federal Decree-Law No. 13 of 2022, provides a crucial financial safety net for workers who lose their jobs due to reasons beyond their control (e.g., redundancy, economic downsizing).
Here is a detailed breakdown of its benefits and how compensation is calculated: The scheme pays a temporary income that helps cover living costs while you look for new work. Because the payout rules are clear, it is easy to understand and apply.
Benefits of UAE Employment Insurance
1. Financial Compensation
- Monthly Cash Benefit: Eligible employees receive 60% of their average basic salary calculated over the six months preceding job loss
2. Timely and Predictable Support
- Quick Processing: Claims are processed within two weeks of submission, ensuring swift financial relief.
3. Social Stability
- Reduces financial stress during job transitions, allowing focused job searching.
4. Fixed duration
- Benefits are paid for up to three consecutive months per claim.
5. Economic Resilience
- Enhances the UAE’s attractiveness to global talent by offering a security net.
This system is clear, affordable, and reliable. Since it balances low cost with meaningful support, UAE employment insurance helps workers stay financially secure during career changes while keeping the job market stable.
How Compensation Amount is Calculated
The compensation is derived using a straightforward formula:
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Monthly Benefit = 60% × (Average Basic Salary Over Previous 6 Months)
Example Calculations:
- Category A Example:
- Basic salary: AED 12,000
- Average basic salary (last 6 months): AED 12,000
- Benefit each month: 60% × AED 12,000 = AED 7,200 (within the AED 10,000 cap).
- Category B Example:
- Basic salary: AED 25,000
- Average basic salary (last 6 months): AED 24,000
- Benefit each month: 60% × AED 24,000 = AED 14,400 (within the AED 20,000 cap).
Key Notes:
- The average basic salary is calculated from the 6 months prior to job loss.
- Even if 60% of the pay exceeds these restrictions, benefits are limited to AED 10,000 (Category A) or AED 20,000 (Category B).
The UAE employment insurance (ILOE) scheme offers critical financial support during unexpected job loss, providing up to 60% of the average basic salary for three months. Its structured calculation ensures fairness, while eligibility criteria and exemptions maintain focus on vulnerable workers. By reducing economic instability, the scheme strengthens both individual security and the broader UAE labor market.
Visit the UAE government portal or the ILOE portal for information about claims or subscriptions.
How to Register for UAE Employment Insurance?
In the UAE, registering for employment insurance is a quick and easy process. The process is fully digital, linked to your Emirates ID, and open through several official channels. Since the program is mandatory for most workers, it is important to complete registration within four months of starting a new job.
7 Steps to Register for UAE Employment Insurance
1. Check eligibility
- Every worker in the public and commercial sectors is required to register.
- Exempt groups include domestic workers, business owners, and juveniles under 18.
2. Choose a registration channel
- ILOE website: www.iloe.ae
- ILOE smart app (iOS and Android)
- Al Ansari Exchange branches across the UAE
- ATMs, kiosks, and telecom outlets (Etisalat, Du)
- MoHRE service centers (Tawjeeh and Tasheel)
3. Enter Emirates ID details
- Your details are verified instantly.
- Subscription is tied directly to your Emirates ID.
4. Pick a salary category
- Category A: AED 16,000 or less → AED 5 monthly
- Category B: Above AED 16,000 → AED 10 monthly
5. Select your payment plan
- Pay monthly, quarterly, semi-annually, or yearly.
- Fees are fixed and affordable.
6. Confirm registration
- Enter your mobile and email for notifications.
- After payment, confirmation is sent by SMS and email.
7. Maintain payments
- Coverage begins after the first payment.
- Missing payments for three months can suspend coverage and lead to fines starting from AED 400.
Registration Table for UAE Employment Insurance
| Step | Action | Notes |
| 1 | Check eligibility | All except exempt groups must subscribe |
| 2 | Select channel | ILOE site, app, exchanges, ATMs, MoHRE |
| 3 | Enter Emirates ID | Auto-verification of worker details |
| 4 | Pick a salary category | A: ≤ AED 16,000 / B: > AED 16,000 |
| 5 | Choose a payment plan | Monthly, quarterly, semi-annual, or yearly |
| 6 | Confirm registration | Coverage is active after the first payment |
| 7 | Keep payments updated | Avoid fines and coverage suspension |
This registration process is affordable, flexible, and monitored by the UAE government. Because it combines low cost with real protection, employment insurance is an essential safety net for every eligible worker in the country.
What happens if I do not subscribe to employment insurance?
Not subscribing to the UAE employment insurance brings financial and legal risks. Missing the initial registration period results in a fine of AED 400. Delaying premium payments adds another AED 200 penalty.
If non-payment continues, coverage can be suspended, and you may face restrictions when renewing your work visa or labor card. To avoid penalties and ensure continuous protection, all eligible employees are required to register on time and maintain regular payments.
Read more to know how to check your ILOE fine online.
Who is eligible to claim benefits from employment insurance?
To claim UAE employment insurance benefits, you must meet three conditions: pay premiums for at least 12 consecutive months, lose your job for non-disciplinary reasons, and submit your claim within 30 days of unemployment.
How to Submit a Claim for Employment Insurance Benefits in the UAE
If you lost your job and paid for your ILOE insurance plan, you may qualify for a short-term monthly benefit. Yet, to receive it, you must follow the steps correctly and submit your claim on time. Below is a simple guide that helps you avoid delays and ensures your claim is accepted.
Steps to Submit Your Claim
- Wait at least 30 days after your job loss before applying
- Log in to the ILOE portal or mobile app using UAE Pass
- Select the Submit Claim option
- Fill in your job loss date and last working day
- Add your salary and job details correctly
- Upload the required documents (see below)
- Review all info carefully
- Click Submit and wait for confirmation
Documents You Need
| Document | Required? |
| Emirates ID | Yes |
| UAE Bank IBAN Letter | Yes |
| Proof of Job Termination | Yes |
| Labor Contract (if requested) | Maybe |
Key Conditions
- You must be subscribed to employment insurance before the job loss
- You have 30 days from the date of your termination to apply.
- Throughout the procedure, you have to remain in the UAE.
- If you were fired or resigned due to wrongdoing, you cannot make a claim.
How the Process Works
| Step | Action | Description |
| 1 | Check Eligibility | Must be insured; job loss, not misconduct |
| 2 | Prepare Documents | Emirates ID, IBAN, termination proof |
| 3 | Apply Within 30 Days | Don’t miss this deadline |
| 4 | Submit via Portal | Or use the app or service centers |
| 5 | Wait for Approval | Payout is issued within 2 weeks if approved |
Before submitting, check every detail twice. Errors in date or documents may delay or block your payment. Need help? Reach out to Business Link UAE to guide you step-by-step.
Can freelancers or business owners apply for employment insurance?
No, employment insurance applies only to employees with valid labor contracts. Freelancers, investors, and owners of establishments are not included. They need to secure their own private protection plans.
Why is employment insurance important for workers in the UAE?
Employment insurance ensures income stability during uncertain times. It allows employees to focus on finding new opportunities without falling into financial hardship. The system also supports the country’s labor market by keeping workers protected and motivated.
Can You Get Employment Insurance in the UAE After Resignation?
No. If you resigned or were fired for disciplinary reasons, you cannot claim employment insurance.
The claim is valid only when:
- Termination was due to company restructuring
- The job was made redundant
- The employer shut down
Always check your termination reason.
How can one avoid disqualification from employment insurance?
To avoid disqualification:
- Pay on time every month
- Don’t delay your claim
- Don’t resign or get fired for disciplinary reasons
- Keep a valid residency
Employment insurance is only helpful if you’re active in the system.
What Is the Difference Between Employment Insurance and Gratuity in the UAE?
Many workers mix up employment insurance and gratuity, but they serve very different purposes. Both offer financial help, but the timing, payment method, and rules vary.
Here’s what you need to know.
Employment Insurance (ILOE Scheme)
- Purpose: Monthly income support after losing your job involuntarily (not resignation or misconduct).
- When Paid: After involuntary termination.
- Who Pays: Government-managed insurance fund (ILOE).
- Eligibility: Most workers in the private and federal sectors must register within 4 months of starting.
- How Much:
- 60% of your average basic salary from the last 6 months.
- Up to AED 10,000/month (Category A, salary ≤ AED 16,000).
- Up to AED 20,000/month (Category B, salary > AED 16,000).
- Duration: Paid for up to 3 consecutive months per claim. Only one claim is allowed every 2 years.
- Legal Basis: Federal Decree-Law No. 13 of 2022.
End-of-Service Gratuity
This is a one-time reward for loyal service when your job ends.
- Purpose: Recognizes your years of work with a final payment
- When Paid:
- After resignation
- End of fixed contract
- Employer-initiated termination (not for cause)
- Who Pays: Your employer (not the government)
- Who Qualifies:
- must work full-time for at least a year.
- Applies to employees under the UAE Labour Law
- How Much:
- First five years: 21 days of base pay annually
- After five years: 30 days of annual basic pay
- Based on the last drawn basic salary
- When Received: Paid as a single lump sum after your job ends
- Legal Reference: Federal Decree-Law No. 33 of 2021
Can You Get Both?
Yes. If you’re eligible, you can receive both employment insurance and gratuity.
They are separate benefits. One helps after job loss, the other rewards your service.
Real Example
Let’s say your basic salary is AED 12,000.
- If you lose your job, ILOE pays:→ 60% of AED 12,000 = AED 7,200/month→ Paid for up to 3 months
- If you worked 6 years:→ First 5 years: 21 days × 5 = 105 days→ Sixth year: 30 days→ Total = 135 days’ salary as gratuity
Quick Comparison Table
| Feature | Employment Insurance (ILOE) | Gratuity (End-of-Service Benefit) |
| When Paid | After a job loss | After leaving your job |
| Paid By | ILOE insurance fund | Your employer |
| Payment Type | Monthly (max 3 months) | One-time payment |
| Eligibility | No minimum service needed | Must work at least 1 year |
| How Calculated | 60% of the average basic salary (last 6 months) | Basic salary × years of service |
| Max Amount | AED 10K–20K/month (based on category) | No cap – depends on salary & years |
| Legal Source | ILOE Law (2022) | UAE Labour Law (2021) |
Finally
- Employment insurance offers short-term relief during job loss.
- Request a gratuity as a token of appreciation for your many years of work.
- Both are your rights. Don’t miss out.
Want help with your employment visa, ILOE registration, or end-of-service guidance? Contact Business Link — we make every step clear, legal, and stress-free.
Summary
When it comes to employment insurance, awareness is key. It protects workers during job loss, yet many still miss deadlines or overlook details. Business Link has years of experience supporting investors and guiding them in company registration. With expert help, you avoid mistakes, save time, and secure compliance. Call Business LinkUAE today and take your next step with clarity, confidence, and the right support beside you.
Contact our team today by phone at +97143215227, WhatsApp at +971502052735, or email at connect@businesslinkuae.com to receive clear answers, expert advice, and hands-on assistance, ensuring you attend your appointment fully prepared and confident.
FAQ’s
Is employment insurance in the UAE mandatory?
Yes. All eligible workers must register or face fines.
What if my salary is commission-based?
Many workers in the UAE earn through commission. If your contract does not list a basic salary, you can select your subscription category yourself. This gives you the flexibility to decide your premium and ensures you are still covered under the ILOE scheme.
Is it possible to claim UAE employment insurance more than once?
Yes. You can make multiple claims if you lose your job more than once. However, the law sets a lifetime cap. The total benefits you receive cannot exceed 12 months of payments during your entire career in the UAE. This shows the program is a short-term safety net, not a permanent income source.
Where can I find official information?
For the most accurate details, always check
- The official ILOE portal: www.iloe.ae
- Website of the Ministry of Emiratization and Human Resources (MoHRE)
- These platforms provide current rules, payment details, and registration steps.
How long do I have to register?
You must register within four months of starting a new job. Missing this deadline can result in fines starting from AED 400.
What happens if I miss payments?
If you miss payments for more than three months, coverage may be suspended, and fines will apply. To stay protected, keep your subscription active.
Can self-employed workers register?
Yes, self-employed workers can register voluntarily by selecting a salary category and payment plan through official ILOE channels.
Which workers are exempt?
Domestic staff, business owners, and juveniles under 18 are exempt from UAE employment insurance registration.
Can I register if I work in a free zone?
Yes. Free zone workers are required to subscribe.
When must I apply for compensation?
Within 30 days of losing your job.
