The United Arab Emirates government has approved a new unemployment insurance program for almost all employees (including foreign nationals) as part of a continuing initiative to modernize and strengthen the country’s labor market. The legislation, Federal Decree Law No. 13 of 2022, took effect October 11, 2022, but the program is not expected to begin operations until 2023. Implementation regulations with further details are expected to be issued by the end of 2022. Separately, the requirement introduced by the new labor law (Federal Decree Law No. 33 of 2021) that all employment contracts must be fixed-term agreements of no more than three years’ duration has been amended, effective September 29, 2022, to remove the three-year cap on the duration.
The main provisions of the new unemployment program include:
Federal Decree Law No. 14 of 2022, effective September 29, 2022, removed the requirement that employment agreements not exceed three years in duration. Employers and employees can conclude agreements for any specified period (renewable without limit, as under prior law).
Law No. 13 does not have any provisions requiring action on the part of employers nor does it address how employees will pay the unemployment insurance premiums, select insurers or be enrolled in the program. Implementing guidelines will presumably address these matters. The requirement under Law No. 33 that all indefinite-term agreements be converted to fixed-term contracts by February 2, 2023 (one year after the effective date of the new labor law) remains in effect and should be met by the deadline.
