Employees are the backbone of any successful organisation, and prioritising their well-being is crucial for fostering a productive and thriving work environment.
Get Optimal SME terms in UAE
Workmen's compensation, as per the UAE labour law, plays a significant role in safeguarding employees' interests by providing financial support and medical assistance in the event of work-related injuries or illnesses. Understanding the importance of workmen's compensation not only ensures compliance with legal requirements but also demonstrates an organisation's commitment to employee welfare.
This article offers a comprehensive guide to workmen's compensation as per the UAE labour law, covering all the relevant aspects such as the legal framework, eligibility, benefits, inclusions, exclusions, and the factors affecting the insurance premium. By familiarising themselves with these critical details, both employers and employees can contribute to a safer and more supportive work culture.
The legal framework for workmen's compensation in the UAE is primarily based on the UAE Labour Law, specifically Federal Law No. 8 of 1980, which governs labour relations and outlines employers' and employees' rights and obligations.
The Ministry of Human Resources and Emiratisation (MOHRE) is the government body responsible for overseeing and enforcing the UAE Labour Law. It ensures that employers and employees comply with the law's provisions, including workmen's compensation.
The MOHRE also provides guidance, resolves disputes between employers and employees, and imposes penalties in case of non-compliance. In the context of workmen's compensation, the MOHRE's role includes facilitating dispute resolutions, monitoring employer compliance, and promoting a safe and supportive work environment.
Let’s understand the workmen's compensation as per UAE labour law - Federal Law No. 8 of 1980
This law provides comprehensive regulations regarding employment contracts, working hours, wages, leaves, termination, and workmen's compensation, among other aspects of labour relations. It ensures the protection of employees' rights and sets forth the requirements and responsibilities of employers in case of work-related injuries, illnesses, or disabilities.
Several articles within the UAE Labour Law address workmen's compensation, with the most relevant provisions being –
Workmen's Compensation Insurance, as per the UAE labour law, is a policy that employers can get to cover their financial obligations and liabilities arising from work-related injuries or occupational diseases sustained by their employees. This type of insurance helps employers comply with the legal requirements of Federal Law No. 8 of 1980, which governs labour relations in the UAE.
Apart from the legal requirement, having workmen's compensation insurance also shows an employer's commitment to employee welfare and helps create a safe and supportive work environment.
Generally, workmen's compensation insurance covers medical expenses, lost wages, and, in some cases, disability benefits or death benefits for the employee's family to ensure that employees can receive adequate support during their recovery.
With the help of workmen's compensation insurance, employers can transfer the risk of financial losses resulting from work-related accidents to the insurance provider, thus providing financial protection to their business.
Let’s take a look at the prominent inclusions of workmen's compensation insurance as per labour law–
In this case, the employee can still perform some work duties, albeit with certain limitations. Under this, the compensation shall be a percentage of the death amount, depending on the injury. Some examples of permanent partial disability include the loss of a finger or an eye.
During the period of temporary total disability, the employee is unable to work, and their condition is considered temporary, as opposed to a permanent disability. As per the law, the employer shall pay the full wages for 6 months, which reduces to half for the next 6 months or until the employee fully recovers, is declared disabled or passes away (whichever happens first).
Listed below are some key exclusions of workmen's compensation insurance –
Add-ons in workmen's compensation insurance are additional coverages that can be included in a policy to enhance the protection provided to employees. These add-ons can help address specific needs and risks that may not be covered under a standard policy.
Here are some common add-ons for workmen's compensation insurance –
In cases where an employee's injury or death is caused by the employer's negligence, public prosecutors or the deceased employee's family may pursue legal action against the employer for wrongful death or injury. In these situations, a court may award damages that exceed the AED 35,000 maximum coverage provided under the basic workmen compensation (WC) death benefit.
Employer's liability coverage is an add-on to the workmen's compensation insurance policy that protects employers against such court-awarded damages and associated legal defence costs up to the limit specified in the policy.
These limits typically start at AED 500,000 for any single occurrence or for a total of multiple occurrences during the policy period. By including employer's liability coverage in their insurance policy, employers can safeguard their business from the financial burden of potential lawsuits and ensure compliance with legal obligations in cases of work-related injuries or deaths caused by their negligence.
This add-on extends the coverage to provide protection to employees for accidents occurring outside the regular working hours and premises. This coverage typically provides compensation for medical expenses, temporary or permanent disability, and death benefits to the employee's family in the event of a fatality. However, the specific terms and conditions of the 24-hour personal accident cover, including the coverage limits and exclusions, may vary depending on the insurance provider and policy.
It provides additional protection to employees during their commute to and from their workplace. This extension of coverage addresses the risks associated with transportation, such as accidents, injuries, or fatalities that may occur while employees are travelling to or from work.
Some of the key factors affecting workmen's compensation insurance as per labour law premiums include -
You can easily apply for workmen's compensation insurance via Policybazaar.ae. It is an online platform through which you can apply for insurance and banking products in just a few clicks and find the best plans from the leading providers.
Follow the given steps to apply for workmen's compensation insurance via Policybazaar.ae –
Alternatively, you can call our customer care number to get more deets on workmen's compensation insurance.
Refer to the next section of the article ‘Frequently Asked Questions’ to learn more about Workmen's Compensation per UAE labour law.
Q1. Is workmen's compensation insurance mandatory for employers in the UAE?
Yes, workmen's compensation insurance is mandatory for all employers in the UAE under the UAE Labour Law (Federal Law No. 8 of 1980). Employers are required to compensate employees for work-related injuries, illnesses, or deaths, and insurance coverage can help employers meet these obligations.
Q2. What does a standard workmen's compensation insurance policy cover in the UAE?
A standard workmen compensation insurance policy in the UAE typically covers medical expenses, wage replacement for temporary or permanent disability, and death benefits for the employee's family in case of a work-related injury, illness, or fatality.
Q3. Can employers extend coverage beyond the standard workmen's compensation policy?
Yes, employers can choose from various add-ons to extend their workmen's compensation insurance coverage. Some popular add-ons include employers' liability, transportation cover, and 24-hour personal accident cover.
Q4. How are compensation amounts calculated in workmen's compensation insurance claims?
Compensation amounts are calculated based on factors such as the nature and severity of the injury or illness, the employee's pre-injury wages, the duration of the disability, and the applicable laws and regulations in the UAE.
Q5. What is the role of the Ministry of Human Resources and Emiratisation (MOHRE) in workmen compensation in the UAE?
The MOHRE plays a crucial role in regulating and overseeing workmen's compensation in the UAE. It ensures that employers comply with the UAE Labour Law, provides guidelines for compensation calculations and requirements, and helps resolve disputes between employers and employees related to workmen compensation claims.
Policybazaar UAE – Helping you navigate the wilderness of the insurance world!