UAE declares changes to policies on visas, workers

The United Arab Emirates has announced sweeping changes in its labour and visa rules that will ensure the better protection of workers’ rights and do away with bank guarantees for recruitment in the private sector.

Indian workers are expected to be among the major beneficiaries of the measures, which were approved by the UAE cabinet on Wednesday. The measures will also stimulate and diversify the UAE’s oil-dependent economies.

Businesses will now pay an annual fee of 60 dirhams ($16.34) per worker for a low-cost insurance policy instead of a bank guarantee of 3,000 dirhams, staterun WAM news agency reported. The oil-rich emirates are also loosening visa rules for job-seekers, tourists and students to encourage people to come, stay longer and spend more.

“These will go a long way in easing the financial burden on Indian workers, professionals and entrepreneurs,” Navdeep Singh Suri, India’s ambassador to the UAE, was quoted as saying regarding the measures by Gulf News. “They also demonstrate the pragmatic and progressive approach of the UAE’s leadership…That is why the UAE remains a preferred destination for Indian investors and workers alike,” he added.

Analysts said the low-cost insurance policy which replaces the bank guarantees will cut costs for employers and offer greater protection to vulnerable low-income workers. The new rules, however, won’t apply to domestic workers such as maids.

“The employee will have better protection as he or she can complain to the ministry of human resources and emiratisation in the event of non-payment of minimum entitlements and then the ministry can draw on the insurance to provide a pay out,” Sara Khoja, a partner at the law firm Clyde & Co in Dubai, was quoted as saying by The National.

The insurance policy will cover end of service benefits, holiday and overtime allowances, unpaid wages, return air ticket and cases of work injury, with the maximum pay out capped at 20,000 dirhams per person. The current system of bank guarantees doesn’t cover entitlements such as gratuity and holiday allowances.

NEWDELHI: THE CHANGES WILL LEAD TO THE RELEASE OF $3.8 BILLION IN BANK GUARANTEES INTO THE ECONOMY, FREEING UP CAPITAL FOR FIRMS FOR OTHER PURPOSES.