Dubai: The Ministry of Human Resources and Emiratisation has introduced a new Ministerial Resolution related to Bank Guarantees and Employees’ Protection Insurance Scheme in the private sector.
The decision (ministerial resolution no. 318 of 2022) is in line with the legislative framework that strives to protect workers’ rights, support the business community, enhance the competitiveness and stability of the UAE’s work environment, and strengthen its reputation as a preferred and safe destination to live, work, and invest.
The UAE’s commitment to guarantee and balance the rights of workers and employers reflect national legislations and highlight the nation’s active role in the main agreements originating from the International Labor Organization.
Ms. Aisha Belharfia, Assistant Undersecretary for Labour Affairs at the Ministry of Human Resources and Emiratisation (MOHRE), remarked about the country’s commitment towards the workforce.

The MoHRE Official further added that, “Offering establishments the option of choosing between providing a bank guarantee or an insurance policy allows them to choose what is most suitable for them and helps reduce operational costs, enabling employers to fulfil their legal obligations towards their workers.”
BANK GUARANTEE OR INSURANCE
The new resolution offers 2 (two) options for establishments;
Bank Guarantee

Organizations can offer a bank guarantee of no less than $816.7 (AED3,000) for each worker, paid through a UAE-based bank, provided that the guarantee is valid for 1 year, can be automatically renewed and paid at the Ministry of Human Resources and Emiratisation’s demand, without any other restrictions.
Insurance Policy
Establishments can also facilitate a 30-month insurance policy, at a value of $37.44 (AED137.50) for each skilled worker, $49 (AED180) for each low-skilled worker and $68 (AED250) for each worker paid by high-risk establishments that are not registered with the Wages Protection System (WPS).
The insurance coverage amounts to up to $5,445 (AED20,000) and includes the wages of the worker’s last 120 working days, the end-of-service gratuity, the expenses of returning the worker to their home country, and in the event of the worker’s death, the costs of repatriating the body to his home country, and other rights and entitlements that the employer is unable to fulfil, based on a decision by the ministry or the concerned labor court.
The resolution outlines 4 cases where the employer may submit a request to reclaim the employee’s bank guarantee or the remainder therefrom, including;
- In the event of cancellation of the employee’s work permit and providing proof of their departure from the country
- In case of the employee’s death and providing proof of the body’s repatriation or burial in the UAE
- If the employee is transferring to a new employer or
- Any other case in which the employer provides proof of cancellation of the employee’s work permit and payment of entitlements due to the employee.

The Ministry reserves the right to refuse to reimburse the bank guarantee to the employer in 2 cases;
- If the employer is a party to a collective labor dispute until the employee’s entitlements are settled or
- If evidence of due fines against the establishment is proven, or if the establishment’s work permits have been suspended.