UAE: Hiring Housemaids To Become Cheaper Soon

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The mandatory Dh3,000 deposit that companies must pay when they hire each employee will be reduced significantly from October 15.

The country’s labour ministry on Wednesday said businesses will pay just Dh60 to comply with new requirements that are intended to make it cheaper to recruit new staff.

The changes have also been made to improve the rights of employees, particularly blue collar workers.

The Ministry of Human Resources and Emiratisation will begin the implementation of a low-cost insurance scheme in replacement of the bank guarantee system for private sector employees, starting from October 15.

The move is in line with the Cabinet decision on the adoption of the insurance system as an alternative to the bank guarantee provided by employers, which costs Dh3,000 per worker. In contrast, the insurance will be priced at Dh60 per year per employee.

The decision was approved by His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice- President and Prime Minister of the UAE and Ruler of Dubai, during the Cabinet meeting held in June.

The new system will release Dh14 billion back to private companies and will help lower the cost of doing business.

The insurance policy, as per the new system, covers the workers’ end of service benefits, vacation allowance, overtime allowance, unpaid wages, return air ticket and cases of work injury, in which the insurance coverage amounts to Dh20,000 a person.

The scheme is aimed at securing workers’ rights in the private sector and reducing the burden on employers, allowing businesses to recover about Dh14 billion in guarantees, freeing up capital for other purposes such as reinvestment.

From October 15 hiring housemaids to obtain cheaper as insurance scheme will replace bank guarantee


Source Credit: Saudinew


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