The government in the United Arab Emirates has set itself the task of making changes to improve the UAE employment law. The goal is to change the laws to make them more modern and flexible. With this, labor relations between employees and employers of companies can be improved. In addition, the new reforms are intended to attract and retain international talent; thus, how to improve productivity, and competitiveness and promote the inclusion of the work environment.
In this article, we are going to analyze the main aspects of the UAE employment law. Particularly, the new reforms that were implemented will be discussed. The new law introduces significant changes in issues such as the duration and termination of contracts, unemployment insurance, and hours of the work week. In addition, issues such as gender equality, conflict resolution, and employee privacy are taken into account. Details such as those referring to permits and sick leave will also be seen.
What is the labor law for employees in UAE?
Federal Decree-Law No. 33 of 2021 and which was implemented in February 2022, is a reference from employers or the human resources department. In this way, get guidance and clarification with; working hours, overtime, salary, among others. Both employers must know their responsibilities and employees their rights and this will be better explained below:
Working hours: according to the UAE employment law, working hours within the private sector are identified as 8 hours or 48 hours per work week. However, the hours may increase to 9 hours per day upon receipt from MoHRE. Most of the companies where the employee works 9 hours are from the consulting, food, and beverage industry. During the month of Ramadan, the hours are reduced to 2 hours a day.
Overtime: when the employee works more than the established hours, this is considered overtime. This will receive a salary that will be equal to that corresponding to a normal work day. In addition, it is calculated on the base salary with an addition of an increase of not less than 25% of the salary. Even this can increase to 50% if the overtime is done between 10 pm and 4 am.
Minimum wage: currently in the new employment law UAE, there is no established minimum wage. This refers to the fact that wages must cover the basic needs of employees.
Wage Protection System: the WPS is fundamental so that the rights of workers can be guaranteed and safeguarded. In this way, trust is generated between the company and the employees. With WPS, these salaries will be sent to employees’ accounts in banks authorized by the central bank of the UAE.
Employment laws and regulations in the private sector
Thanks to the new UAE employment law in the private sector, new regulations also arise. It is important to be aware that these new adjustments will alter how the private sector handles jobs. An example of this is how this new UAE labor law will include contracts with a shorter fixed term. In addition, cooperative obligations and more flexible work schedules.
In addition, the UAE labor law of 2023 will also include adjustments that are related to leave. Here, an example would be the changes to the maternity leave regulations.
Health Insurance: In 2023, a law was issued by the Dubai Health Authority or DHA, where health insurance is required for people living in Dubai. Under this law, companies or visa sponsors must offer health insurance protection to their employees or sponsors. In addition, this health insurance must have the minimum benefits required by the DHA
Work contracts and recruitment: an employee must have a work contract that is fixed term and that is not longer than three years. All contract renewals are allowed and count toward the length of service. When hired, with the new employment law UAE allows a variety of types of employment contracts. Among them are: limited, unlimited, and part-time, among others.
What are the new rules in UAE 2023 for employees?
For the year 2023, some reforms were made in the UAE employment law that are of interest to all workers. Taking this into consideration; this section is intended to explain what are the new rules that employees must follow starting this year.
Labor law update: The employment labor law in UAE, has had an update that all employees must now follow. This is specifically for the private sector. Among the most relevant changes are the elimination of unlimited contracts, new work models, and protection against discrimination. It should be noted that some of these aspects were explained in detail in the previous section.
Licenses and Permits: Workers in the private sector have six possible options for applying for licenses. Among the most relevant are unpaid leave, additional rest days, sick leave, and emergency leave. In addition, they are given one paid day each week.
Holidays: The government in the United Arab Emirates announced what are the festivities and holidays of 2023. Among which can be mentioned are Remembrance Day (December 1), National Day (December 2 and 3), and finally, the Islamic New Year (March 22).
Anti-harassment policies: One of the most important new rules is the creation of anti-harassment policies in the workplace. This includes physical and verbal abuse. The idea is to establish mechanisms and facilities for victims to file complaints. In addition, strong sanctions against the aggressors will be implemented.
Flexible and shared hours: It is intended to introduce new, more flexible, and friendly work modalities for employees. Thus, workers can adjust workplaces and hours according to their preferences and needs.
Changes in UAE employment law you need to know for 2023
Every good HR team should be working using the new automated trends. This is in order to better manage the work team and, in turn, to be aware of changes in the UAE employment law. The human resources team must have all the information about new laws or changes to existing ones.
For the year 2023, some changes were established that are of the utmost importance to know. A brief description of each of them will be given below.
Elimination of the unlimited contract: in the latest news it is established that unlimited contracts cannot be used in new employee hires. Currently, only three contract types can be used; which are, temporary contract, project contract, and limited contract.
Prohibition of discrimination: in the workplace, discrimination for any reason is prohibited. For instance, race, religion, gender, age, or disability. In addition, equal pay between women and men is guaranteed. If any employee is exposed to a situation of this type, they have the right to make a complaint to the relevant entity.
New work models: flexible work models and work sharing are introduced. These models allow employees to adjust their schedules according to their needs. Of course, taking into account the conditions imposed by the employer.
Flexible work refers to the possibility of doing work from home, that is, remote work. For this, it is important to have the relevant technological means and respect the established schedules. On the other hand, job sharing refers to the possibility of sharing a job with another employee.
Changes in business hours: the new weekends will be Saturdays and Sundays. In addition, the working day consists of a total of 40 hours a week.
New work permit: every individual who wishes to enter the work environment needs a work permit issued by MOHRE.
Employee Rights and Protections
Currently, the government in the UAE is fully committed to enforcing the rights of employees. In case these are violated or disrespected, the victim is granted protection. To have access to this, the complaint must be made to the relevant entity; Generally, it must be done at the Ministry of Human Resources and Emiratization or other authorities that provide the service. The procedure is quite simple; it can even be done online.
Among the rights that employees have in any company, whether in the public or private sector are the following:
Minimum Wage: All workers in the United Arab Emirates are entitled to a minimum wage. This salary will be established by the Minister of Human Resources and Emiratization with the contribution of other relevant authorities. To have facilities in this aspect it is good to have a payroll system or software.
Paid weekly days of rest: all employees have one day of rest a week, which must be paid. It is important to mention that they have the possibility of requesting the increase, agreeing with the employer. Other annual vacations can be used and also some licenses can be requested.
Termination of contract: if the worker or the employer proceeds to request the termination of the contract, the employee has the right to fair compensation. In addition, if required, you have the right to receive a letter of recommendation.
Equal pay: in the new UAE employment law, it is established that both men and women have the right to have the same salary. This is as long as both are doing the same job. In addition, women can apply for any job position, including government ones. But, you must have the consent of your guardian, who can be your husband or father.
Annual Leave and Public Holidays
Within the set of rights available to workers in the United Arab Emirates, there is talk of vacations and holidays. In the case of vacations, the days will depend on the length of service that the employee has in the company. The vacation days to which any worker is entitled are specified below.
- You have two days of vacation each month, provided you have completed six months of service. In addition, you must have worked for the company for less than a year.
- Annually, you must have 1 month of vacation in total, if you have a full year of service in the company.
On the other hand, employees also have the right to have paid vacations, on holidays. The holidays that are celebrated in the UAE are the following:
- Eid Al Fitr
- The Gregorian New Year.
- The Hijri New Year.
- Arafat and Eid Al Adha
- National day
- Prophet Mahima’s Birthday
- The Day of the Martyrs.
Maternity and Paternity Leave
All employees who are pregnant have 1 month and a half of full salary for maternity leave. In addition, he has two additional weeks in which he has half the salary. It is also important to mention that the woman who has maternity leave; You have the possibility of extending these days to a maximum of 1 additional month and a half. However, these days are unpaid.
On the other hand, both the father and the mother have a maternity or paternity leave for a period of five business days, when they have a newborn child. The beneficiary worker can use these days intermittently or continuously until the minor is six months old.
During the first six months of the baby’s age, mothers have the right to breastfeed the child during working hours. They can have two breaks a day to carry out the work and they cannot last more than an hour.
Trade Unions and Collective Bargaining
The new UAE employment law establishes that workers in both the public and private sectors; are not allowed to form any type of union or collective bargaining. Labor law, specifically, in the private sector does not recognize the right of employees to organize to form unions.
Collective bargaining refers to a mechanism that is based on social dialogue, to agree wages and working conditions. In the UAE, this system is not allowed for any employee. This is because it is evident that both collective bargaining and unions can hurt employees and the productivity of the company.
All companies must be aware of these new laws and thus avoid any type of problems. For instance, complaints from employees. For this, it is important to have a good human resources team. The best solution for this is to contact ConnectHR. We will provide you with HR performance management software and solutions. Thus, you can streamline and improve some processes within the company.