The situation
The Cabinet of the United Arab Emirates has announced that an insurance scheme will replace the bank guarantee system in the mainland, which will continue to ensure that employers can cover the costs of foreign employees’ unforeseen circumstances. The effective date of this policy is not yet clear.
A closer look
- Insurance scheme details. The new insurance scheme will provide coverage of up to AED 20,000 per employer in case of unpaid wages and/or various allowances, return tickets and work-related injuries.
- Previously deposited funds. Employers will be able to retrieve the funds deposited with the Ministry of Human Resources and Emiratisation (MOHRE) under the bank guarantee plan.
- Cost. The new insurance scheme will only cost employers AED 60 annually per worker.
Background
Existing regulations require companies in mainland UAE that are registered with the MOHRE to deposit AED 3,000 for each work permit application as a bank guarantee (exemptions exist for the employment of skilled workers and depending on the company category) which covers similar situations that the insurance scheme will cover.
Impact
The new scheme may ease monetary burdens for companies employing foreign nationals.
Looking ahead
Fragomen will provide updates on further details of the new law as they are released by the relevant authorities, including information on whether free zone authorities will modify their regulations regarding bank schemes to match this change in the mainland.
This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].
Explore more at Fragomen
Blog post
Counsel Susan Steger examines how wage-driven selection mechanisms in programs such as the H-1B lottery and PERM can create incentives for artificial wage inflation and introduce new compliance and workforce planning challenges for employers.
Media mentions
Director Gemma Hyslop examines how collaboration across the global mobility sector can help strengthen legal pathways and support for migrant women experiencing abuse.
Media mentions
Partner Abeer Al Husseini discussed immigration and duty-of-care challenges for employers amid Middle East travel disruptions.
Awards
Partner Sarah K. Peterson is recognized by the Minneapolis/St. Paul Business Journal as a 2026 Women in Business honoree for her professional achievements and contributions to the Twin Cities business community.
Media mentions
Immigration Manager Alice Heron explains how HR teams can navigate Irish immigration law and manage international talent effectively.
Media mentions
Associate Ilaria Iovieno and Immigration Consultant Devina Sanghera outline what the proposed expansion of the UK Right to Work Scheme means for housebuilders.
Awards
Partner Cynthia Shearn is recognized by Crain’s Chicago Business in its 2026 Notable Women in Law list, honoring her leadership in immigration and global mobility and her impact within the legal community.
Media mentions
Partner Emily Allen says the new H-1B lottery is driving earlier planning and more detailed preparation.
Blog post
Senior Business Immigration Consultant Ryaihanny Sahrom and Business Immigration Consultant II Fahimah Muhammad examine Indonesia’s newly launched Global Citizenship of Indonesia (GCI) program and its introduction of long-term and indefinite permanent residence pathways for members of the Indonesian diaspora.
Media mentions
Senior Immigration Manager Jonathan Hill notes that tighter UK visa compliance rules and new rating measures create additional challenges for universities.
Video
Partner Diana Quintas outlines key early career visa pathways and practical considerations for employers and graduates navigating entry-level immigration options.
Fragomen news
The Montreal office has added Partner Julie Lessard and Counsel Elsa Agostinho and Sophia Khanzadian to strengthen its immigration services.
Blog post
Counsel Susan Steger examines how wage-driven selection mechanisms in programs such as the H-1B lottery and PERM can create incentives for artificial wage inflation and introduce new compliance and workforce planning challenges for employers.
Media mentions
Director Gemma Hyslop examines how collaboration across the global mobility sector can help strengthen legal pathways and support for migrant women experiencing abuse.
Media mentions
Partner Abeer Al Husseini discussed immigration and duty-of-care challenges for employers amid Middle East travel disruptions.
Awards
Partner Sarah K. Peterson is recognized by the Minneapolis/St. Paul Business Journal as a 2026 Women in Business honoree for her professional achievements and contributions to the Twin Cities business community.
Media mentions
Immigration Manager Alice Heron explains how HR teams can navigate Irish immigration law and manage international talent effectively.
Media mentions
Associate Ilaria Iovieno and Immigration Consultant Devina Sanghera outline what the proposed expansion of the UK Right to Work Scheme means for housebuilders.
Awards
Partner Cynthia Shearn is recognized by Crain’s Chicago Business in its 2026 Notable Women in Law list, honoring her leadership in immigration and global mobility and her impact within the legal community.
Media mentions
Partner Emily Allen says the new H-1B lottery is driving earlier planning and more detailed preparation.
Blog post
Senior Business Immigration Consultant Ryaihanny Sahrom and Business Immigration Consultant II Fahimah Muhammad examine Indonesia’s newly launched Global Citizenship of Indonesia (GCI) program and its introduction of long-term and indefinite permanent residence pathways for members of the Indonesian diaspora.
Media mentions
Senior Immigration Manager Jonathan Hill notes that tighter UK visa compliance rules and new rating measures create additional challenges for universities.
Video
Partner Diana Quintas outlines key early career visa pathways and practical considerations for employers and graduates navigating entry-level immigration options.
Fragomen news
The Montreal office has added Partner Julie Lessard and Counsel Elsa Agostinho and Sophia Khanzadian to strengthen its immigration services.