DMCC (Dubai Multi Commodities Centre) Registration Authority, in collaboration with Dubai Insurance Company, has launched a new Employee Protection Insurance (EPI) Programme that is now mandatory for all sponsored and non-sponsored employees working for DMCC member companies.
Active 19 May 2020, the ‘Bank Guarantee’ visa security deposit of AED 3,000 per employee will be replaced with the EPI scheme – as an offer of increased protection to employees in case DMCC member companies default on salaries, end of service benefits or repatriation costs.
Sponsored Employees are employees of DMCC Entities who have been issued a residence visa through DMCC.
Non-sponsored Employees are the employees of DMCC Entities who have been issued a Permanent Identity Card from DMCC based on their existing residence visa sponsored by parent/spouse.
What is Employee Protection Insurance (EPI) Program?
The Employee Protection Insurance program offers increased protection for member company employees in case their employer defaults on their salaries, end of service benefit, or repatriation cost. It is a mandatory scheme replacing the ‘Bank Guarantee’ security deposit of AED 3,000 per employee.
Can DMCC Entities choose between the Employee Protection Insurance (EPI) and the Bank Guarantee (BG) option?
No, it is mandatory to go with the Employee Protection Insurance.
The only exception is if a DMCC Entity found to have not paid two consecutive salaries for an employee, and the DMCC Disputes Centre receives complaints against it. The DMCC Entity will be put back to the Bank Guarantee for visas and will not be able to take insurance for their new employees or the ones which are renewing their visas. Only once all their complaints are resolved, and their record stays clean for 6 months, they will be allowed to use the EPI Program again.
Who can benefit from the Employee Protection Insurance (EPI) Program?
All DMCC Entities’ sponsored and non-sponsored employees will get the EPI. The individuals applying for investors and partners visas cannot get the insurance.
Moreover, there will be no bank guarantee charged for such a visa from now onwards.
How will the Bank Guarantee (BG) for the active employee visas be refunded under Employee Protection Insurance (EPI)?
The Bank Guarantee (BG) will only be refunded with the Employment Visa Renewal application. When the DMCC Entities apply for the visa renewal of their current active employees, they will automatically be charged the new EPI fee. The previously paid Bank Guarantee of AED 3,000 will be refunded into their member portal’s account. They can then raise a Refund service request to receive the refund amount back to the bank account.
What happens if a DMCC Entity failed in paying an employee’s unpaid salary for two consecutive months under the Employee Protection Insurance (EPI) Policy Terms and Conditions?
If a DMCC Entity is found to have not paid two consecutive salaries for an employee, and the DMCC Disputes Centre receives complaints against it, the DMCC Entity will be put back to the Bank Guarantee for visas and will not be able to take insurance for their new employees or renew their visas. Only once all their complaints are resolved and their record stays clean for 6 months will they be allowed to use the EPI Program again.
How can DMCC Entity apply for Employee Protection Insurance (EPI) Program?
The EPI process is automatically processed and charged in parallel with the Visa related applications and Permanent Identity Card related applications service requests. The Certificate of Insurance will be issued upon the closure of the service requests.
Below are the services that include the EPI:
- New Employment Visa
- Employment Visa renewal
- Employment Visa Transfer
- New Employment Card (PIC)
- Employment Card Renewal (PIC)
- Change of salary application
What are the applicable charges of Employee Protection Insurance (EPI)?
The charges of an EPI depends on the basic salary of the employee (as per the employment contract a DMCC Entity submits to DMCC), as well as the tenure of employee’s visa or Employment Card (PIC) 1, 2, or 3 years.
To view the applicable charges for each of the following scenarios, as follows:
- Insurance Premium for 1 Year Visa – AED 85 – 310
- Insurance Premium for 2 Years Visa – AED 115 – 414
- Insurance Premium for 3 Years Visa – AED 260 – 570
- Insurance Premium – New Employment Card (PIC) – AED 85 – 310
What type of claims Dubai Insurance accepts for Employee Protection Insurance (EPI)?
The claims that employees are covered under the Employee Protection Insurance Policy Terms and Conditions are:
- Unpaid salary
- Unpaid end of service gratuities
- Repatriation cost of return or their mortal remains
- Unreimbursed costs of work-related injuries and diseases
If a DMCC Entity failed in paying the unpaid salary of an employee, will the employee get the full wage with the Employee Protection Insurance (EPI)?
The employee will be paid their dues up to the maximum coverage limit based on their salary band.
How can a DMCC Entity employee get paid for the Dubai Insurance claim in case of defaults?
Once DMCC Disputes Centre files the claim with Dubai Insurance, Dubai Insurance will issue a cheque within 5 working days on the name of the employee and send it to DMCC. DMCC Dispute Centre team will have to get some documents signed and handover the cheque to the employee.
By
Yuliia Katrych
Chartered Compliance Analyst
Elnaggar Legal Advisors Limited
