The United Arab Emirates (UAE) has announced some significant updates aimed at enhancing welfare regulations in the country.
These changes, set to take effect in January 2025, include reforms to the structure of the Ministry of Human Resources and Emiratisation (MoHRE) and the implementation of mandatory health insurance for all private sector employees. These changes are indicative of the UAE’s commitment to ensuring healthcare coverage for all of its residents and strengthening its labour market.
A new MoHRE
The UAE Cabinet approved the comprehensive restructuring plan for MoHRE, with the aim of streamlining processes and enhancing efficiencies. The updates reinforce the Ministry’s role in overseeing the governance of labour affairs and employment regulations, and ensuring the welfare of workers within the UAE.
Under the reformed structure, the Ministry will continue its management and regulation of labour relations, employment standards, and workforce development initiatives, using various federal, local, and private entities. The initiatives that have been implemented by the UAE’s MoHRE in 2023, saw a significant reduction in labour disputes of 75% when compared to the previous year, with over 98% of labour disputes being settled amicably as of March 2024, highlighting the Ministry’s successful governance of labour in the UAE.
Mandatory health insurance
Currently, for expatriates living and working in the UAE, health coverage can be dependent on the individuals salary or designation. In Dubai, employers are required to provide health insurance for their employees, and sponsors are required to get insurance coverage for their dependants. In Abu Dhabi, employers and sponsors are required to provide health insurance to their employees, including their families, with up to three children under the age of 18.
Whereas for UAE nationals, there are differing governing bodies within the individual Emirates, particularly within government bodies, who are responsible for healthcare in their respective Emirate. In Dubai, the Dubai Health Insurance Cooperation are the regulators of the health insurance sector, ensuring the rights of the residents and citizens of Dubai. In Abu Dhabi, under the ‘Thiqa’ programme, all UAE nationals are provided with full medical coverage, along with non-UAE nationals who are under the sponsorship of a UAE national family member. In Sharjah there is the Sharjah Health Authority, ensuring health coverage for UAE nationals in Sharjah.
“The updates to the healthcare regulations in the UAE ensure that every worker is provided access to essential healthcare services”
The updated MoHRE healthcare systems stipulate that all employers in private sector companies, along with employers of domestic workers in the UAE, are required to pay for the health insurance coverage of their registered employees upon the issuance or renewal of their residency permit, as part of the process. This decision is to be enforced on a mandatory basis, as of January 1, 2025. The Ministry will be responsible for undertaking the essential awareness campaigns and programmes regarding this mandate.
The updates to the healthcare regulations in the UAE ensure that every worker across the UAE, irrespective of nationality, salary, designation, or job sector, is provided access to essential healthcare services.
The business impact
For businesses looking to establish in the UAE, it is crucial to have an understanding of the regulatory landscape and operational requirements. To ensure compliance with local laws and regulations businesses should obtain the necessary licenses and approvals from relevant authorities such as MoHRE, including the adherence to labour laws. This is where engaging with a reputable advisor with local expertise to assist facilitate company processes and ensure regulatory compliance in the UAE, like PRO Partner Group, is recommended.
The introduction of mandatory health insurance aligns with the UAE’s vision of prioritising the health and well-being of residents, aiming to encourage a business-friendly environment for employees, improving quality of life and healthcare services. As the UAE prepares for the implementation of these initiatives in the beginning of 2025, businesses must also prepare themselves.