The Ministry of Human Resources and
Emiratisation (MoHRE) has said that the issuance of employee insurance will
begin on October 15.This comes as per the UAE Cabinet’s decision to scrap the
compulsory bank guarantee and replace it with a low-cost insurance system,
according to the ministry.
Aisha Bel Harfia, Assistant Undersecretary for
Domestic Worker Affairs, said the ministry has taken all necessary measures to
begin issuing insurance documents and refunding bank guarantees to the
employers, starting from the aforementioned deadline.
The Ministry of Human Resources and
Emiratisation (MoHRE) has said that the issuance of employee insurance will
begin on October 15.
This comes as per the UAE Cabinet’s decision to
scrap the compulsory bank guarantee and replace it with a low-cost insurance
system, according to the ministry.
Aisha Bel Harfia, Assistant Undersecretary for
Domestic Worker Affairs, said the ministry has taken all necessary measures to
begin issuing insurance documents and refunding bank guarantees to the
employers, starting from the aforementioned deadline.
Bel Harfia clarified that the insurance
document for domestic workers will be issued upon submitting applications
through either Tasheel or Tadbeer service centres. Insurance documents for
private sector employees and domestic workers registered with the ministry will
be issued through an insurance conglomerate that includes national insurance
companies operating in the UAE, which have been chosen according to specific
criteria.
The bank guarantee is replaced by a new
insurance policy that costs Dh60 annually per worker, providing a coverage of
Dh20,000 per worker covering their end-of-service benefits, vacation allowance,
overtime allowance, unpaid wages, worker’s return ticket and cases of the work injury.
The insurance policy of domestic workers also
covers the cost of replacing the worker in cases of his/her interruption of
work, health issues or the desire (of the domestic worker) to cancel the
working relationship, in addition to unpaid wages and the worker’s financial
benefits such as end-of-service and leave allowances and overtime allowance, in
case they have been not be paid by the employer, as well as a return ticket.
Bel Harfia said that the ministry will start
refunding bank guarantees to employers, totalling about Dh14 billion as of
October 15.
Bel Harfia added that the bank guarantees will
be refunded to establishments when cancelling work permits of workers covered
by these guarantees, which will thereby end the working relationship between
the two parties or when purchasing the insurance policy upon renewal of the
employee’s work permit, on the condition that the establishment has not
committed violations related to non-payment of salaries during the last six
months before the renewal of the expired permit.
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