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
Fragomen news
Fragomen’s "Immigration Guide for the UK Tech Sector" introduces visa options available for those working and recruiting in the tech sector.
Blog post
Center for Strategy and Applied Insights Senior Director Leah Rogal examines how employers can use the J-1 Research Scholar visa to retain eligible global research talent, support long-term research initiatives and strengthen workforce and immigration planning.
Blog post
In this blog, Middle East and Africa Private Client Practice Director Nofi Mojidi-Bayna explores how evolving residency frameworks across the region are reshaping long-term mobility planning and examines the three global forces transforming immigration strategy for businesses, investors and internationally mobile families.
Blog post
In this blog, Associate Halil Kaya outlines the UK Visa Fees Reimbursement Scheme for Scale Ups, including eligibility requirements, available funding and key considerations for high-growth businesses recruiting international talent.
Media mentions
Blog post
Media mentions
Senior Associate Isabel Schnitzler outlines the key compliance considerations for employers with employees working across the EU.
Podcast
Associates Julia Manacher and Stephanie Weaver examine immigration issues emerging in a popular reality television series, including K-1 visa denials, consular non-reviewability, fraud findings and changing adjudication policies.
Blog post
Manager Dr. Adela Schmidt examines common misconceptions in German citizenship law, including birthright citizenship, dual citizenship, citizenship by descent and naturalization processing, and explains why eligibility often depends on specific legal requirements, timelines and documentation.
Awards
Partner Audrea Golding, Senior Associate Kyle Sommer and Senior Talent Development Director Wendy Milici have been named finalists in the 2026 TLC Lions Human Awards Americas, recognizing their contributions to human-centered leadership, workplace culture and inclusion.
Media mentions
Fragomen and SICPA have launched a global joint venture to develop an end-to-end digital identity platform that enables secure identity verification, document authentication and verifiable credential management.
Media mentions
Senior Counsel Mitch Wexler discusses how potential changes to H-1B visas, employment-based green cards and OPT could impact employers’ workforce planning and compliance obligations.
Fragomen news
Fragomen’s "Immigration Guide for the UK Tech Sector" introduces visa options available for those working and recruiting in the tech sector.
Blog post
Center for Strategy and Applied Insights Senior Director Leah Rogal examines how employers can use the J-1 Research Scholar visa to retain eligible global research talent, support long-term research initiatives and strengthen workforce and immigration planning.
Blog post
In this blog, Middle East and Africa Private Client Practice Director Nofi Mojidi-Bayna explores how evolving residency frameworks across the region are reshaping long-term mobility planning and examines the three global forces transforming immigration strategy for businesses, investors and internationally mobile families.
Blog post
In this blog, Associate Halil Kaya outlines the UK Visa Fees Reimbursement Scheme for Scale Ups, including eligibility requirements, available funding and key considerations for high-growth businesses recruiting international talent.
Media mentions
Blog post
Media mentions
Senior Associate Isabel Schnitzler outlines the key compliance considerations for employers with employees working across the EU.
Podcast
Associates Julia Manacher and Stephanie Weaver examine immigration issues emerging in a popular reality television series, including K-1 visa denials, consular non-reviewability, fraud findings and changing adjudication policies.
Blog post
Manager Dr. Adela Schmidt examines common misconceptions in German citizenship law, including birthright citizenship, dual citizenship, citizenship by descent and naturalization processing, and explains why eligibility often depends on specific legal requirements, timelines and documentation.
Awards
Partner Audrea Golding, Senior Associate Kyle Sommer and Senior Talent Development Director Wendy Milici have been named finalists in the 2026 TLC Lions Human Awards Americas, recognizing their contributions to human-centered leadership, workplace culture and inclusion.
Media mentions
Fragomen and SICPA have launched a global joint venture to develop an end-to-end digital identity platform that enables secure identity verification, document authentication and verifiable credential management.
Media mentions
Senior Counsel Mitch Wexler discusses how potential changes to H-1B visas, employment-based green cards and OPT could impact employers’ workforce planning and compliance obligations.
