Overview of UAE labor laws
The cornerstone of employment regulation in the UAE is Federal Decree-Law No. 33 of 2021, which marked a moment in the country's labor legislation when it came into force on February 2, 2022. This comprehensive reform replaced the four-decade-old Federal Law No. 8 of 1980, introducing modern employment practices and enhanced worker protections. The law's implementation was further refined through Cabinet Decision No. 1 of 2022, which provided detailed executive regulations for practical application.
What sets the UAE's labor law framework apart is its sophisticated multi-jurisdictional approach. While the federal labor law governs most of the UAE's mainland (onshore) territory, the country's financial free zones – notably the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) – operate under their own distinct employment regulations.
The DIFC follows Employment Law No. 2 of 2019, while the ADGM applies its Employment Regulations 2019, both offering specialized frameworks tailored to international financial services sectors.
Recent legislative developments, particularly through Federal Decree-Laws No. 14 of 2022 and No. 20 of 2023, have further refined the employment landscape. These amendments demonstrate the UAE's responsiveness to evolving workplace dynamics and international best practices. Notably, the law's scope extends to all private sector employees, including foreign nationals, while maintaining specific exclusions for categories such as public sector employees, military personnel, and domestic workers, who are governed by separate legislation.
The UAE's approach to labor regulation continues to evolve. These changes strengthen dispute resolution mechanisms and enhance worker protections, reflecting the country's commitment to maintaining a competitive yet fair labor market. The reforms include:
- Significant increases in penalties for non-compliance;
- Improved mechanisms for resolving employment disputes, particularly through the enhanced role of the Ministry of Human Resources and Emiratisation (MOHRE);
- Salary continuation during labor disputes;
- Flexible working arrangements acknowledgment; and,
- Enhanced Provisions for Maternity Leave and Employee Rights.
Employment contracts
The UAE labor framework recognizes fixed-term contracts as the standard for employment relationships across most jurisdictions, while unlimited contracts are now largely obsolete.
Fixed-term contracts
Under the UAE Labour Law, fixed-term contracts are mandatory for onshore employment. These agreements specify a clear start and end date and offer flexibility to renew upon mutual agreement. They must comply with Article 8(3) of the Labour Law and other legislative amendments, such as Federal Decree-Law No. 14 of 2022, which mandated the conversion of unlimited contracts to fixed-term ones by the end of 2023.
In free zones such as the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM), fixed-term contracts are also permitted, with no restrictions on duration. This allows employers to draft contracts tailored to specific business needs, whether short-term projects or multi-year employment relationships.
Other work arrangements
UAE labor regulations accommodate diverse work models, including part-time, flexible, temporary, and remote work. Employers can choose from these arrangements to match operational needs, offering options for traditional full-time roles or innovative structures like job sharing. Every employment contract in the UAE must include specific details to ensure transparency and mutual understanding between employers and employees. The requirements vary slightly across jurisdictions but generally encompass the following:
- Names, addresses, and identification information.
- Title, description, salary, allowances, and benefits.
- Hours, rest days, vacation entitlements, and other leave provisions.
- For fixed-term contracts, the start and end dates must be specified.
- Terms for trial employment, capped at six months.
- Procedures and timelines for ending the contract.
- Some employers may include supplementary terms if they align with the law's minimum requirements.
All onshore contracts must use the Ministry of Human Resources and Emiratisation (MOHRE) templates, typically bilingual in Arabic and English, to streamline compliance.
Rights and obligations under employment contracts
- Employers must honor the agreed-upon terms, including timely payment of salaries, provision of annual leave, and adherence to health and safety standards. They are also required to provide employees with clear notice and justification if terminating a contract.
- Employees have the right to a secure work environment, equitable treatment, and the benefits outlined in their contracts. In turn, they are obligated to fulfill their job responsibilities and comply with workplace policies.
- Probation is limited to six months and offers both parties an opportunity to evaluate the working relationship. If termination occurs during this period, employers must provide 14 days' notice, while employees seeking to resign must adhere to specific notice requirements, varying by intent (e.g., staying in the UAE versus leaving).
- Additional agreements can outline specific roles or benefits but cannot dilute minimum legal protections.
Minimum wage regulations
The United Arab Emirates takes a unique approach to wage regulation. Rather than implementing a nationwide minimum wage, the Ministry of Human Resources and Emiratisation (MoHRE) has developed non-mandatory salary recommendations. These guidelines provide a framework for fair compensation that employers can use as a reference when determining wages.
Employment compensation in the UAE is primarily negotiated through individual contracts, with salaries varying based on an employee's skills, professional background, and current market conditions. While there is no legally binding minimum wage that covers all workers, MoHRE has established salary benchmarks to help ensure workers receive reasonable pay, especially in sectors where wage inequalities might be more prevalent.
Though these salary guidelines are not legally enforceable, they offer employers a structured approach to compensation.
Remote work regulations
Remote work refers to employment arrangements where employees perform some or all their duties outside the traditional workplace. In the UAE, this can include working from home, co-working spaces, or other off-site locations. The scope of remote work arrangements extends across full-time and part-time roles, as well as hybrid models where employees split their time between the office and remote environments.
The UAE’s labor regulations, under Federal Decree-Law No. 33 of 2021 and related guidelines, provide a legal basis for remote work arrangements. Employers and employees are required to formalize these agreements in written contracts, which should clearly outline the terms of remote work. Key elements include:
- Work schedules and the expected hours of availability.
- Job duties and deliverables.
- Compensation, benefits, and allowances.
- Mechanisms for supervision and performance evaluation.
Free zones such as the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) offer additional flexibility, enabling employers to tailor remote work policies to their operational needs while ensuring compliance with overarching labor laws.
Employer obligations regarding remote work
Employers are responsible for ensuring that remote work arrangements align with UAE labor laws. Key obligations include:
- Employers must provide employees with guidance to maintain a safe and ergonomic workspace, even outside the office. This can include offering resources or advice on setting up home offices to minimize physical strain and workplace hazards.
- Employers are expected to implement robust data protection measures to secure company information accessed remotely. This may involve providing secure devices, enforcing data encryption protocols, and offering training on cybersecurity best practices.
- Remote employees should not be excluded from professional development opportunities or workplace initiatives. Employers must ensure that remote workers receive equitable access to training, performance reviews, and organizational updates.
Employee rights while working remotely
Employees working remotely enjoy the same rights and protections as those in traditional office settings. These include:
- Remote employees are entitled to regulated working hours, including breaks, as stipulated by the UAE Labor Law. Employers cannot demand excessive availability beyond agreed-upon schedules unless overtime arrangements are specified and compensated.
- Salaries, allowances, and other benefits must remain consistent with the employee’s contractual agreement. Remote work should not result in reduced pay or exclusion from benefits such as healthcare, leave entitlements, or end-of-service gratuities.
- Employees retain the right to disconnect outside their designated working hours, promoting work-life balance and preventing burnout.
- Remote employees are entitled to equal treatment, including access to workplace resources, grievance mechanisms, and protection from discrimination.
Working hours and leave
Under Federal Decree-Law No. 33 of 2021, private sector employees in the UAE onshore are limited to working eight hours per day or 48 hours per week. During the holy month of Ramadan, working hours are reduced by two hours daily. Overtime is permitted, but it must not exceed two hours per day, except in emergencies to prevent serious loss or accidents. Additionally, the total working hours, including overtime, must not surpass 144 hours within any three-week period.
Employers are required to compensate overtime at enhanced rates:
- A 27 percent increase for overtime worked between 4 a.m. and 10 p.m.
- A 70 percent increase for overtime worked between 10 p.m. and 4 a.m.
- A 70 percent increase or a compensatory day off for overtime worked on rest days.
Exceptions to these limits include employees in supervisory roles, seafarers, and industries requiring continuous shifts, provided weekly working hours average no more than 76 hours.
In free zones, such as the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM), the maximum working week is 48 hours unless the employee consents in writing to exceed this limit. Both zones offer enhanced overtime pay or time off in lieu, but managerial and supervisory positions may be exempted.
Types of leave available to employees
The UAE provides a variety of leave options to cater to employee needs, aligning with international labor standards while accommodating cultural and legal nuances.
Annual Leave
Employees with at least one year of service are entitled to 30 calendar days of paid annual leave. Those with six months to a year of service accrue leave at the rate of two days per month. Annual leave does not apply during probation periods. Unused leave can be carried forward to the next year or compensated monetarily by mutual agreement.
In the DIFC and ADGM, employees receive 20 working days of annual leave after 90 days of service, with the option to carry forward a limited number of unused days into the next year.
Sick Leave
After probation, employees are entitled to 90 calendar days of sick leave per year:
- First 15 days: Full pay
- Next 30 days: Half pay
- Any remaining days: Unpaid
In the DIFC and ADGM, the sick leave entitlement is 60 working days per year, with the first 10 days fully paid, the next 20 days at half pay, and the remaining 30 days unpaid. Employers may terminate the contract if an employee exceeds the permitted sick leave period unless the absence is due to a disability.
Maternity and Paternity Leave
Women employed for at least a year are entitled to 60 calendar days of maternity leave in the UAE:
- First 45 days: Full pay
- Remaining 15 days: Half pay
Fathers receive five working days of paid paternity leave, which must be taken within six months of the child’s birth.
In the DIFC and ADGM, maternity leave extends to 67 working days, with the first 33 days fully paid and the remaining 34 days at half pay. Paternity leave provisions are similar.
Special Leave
Muslim employees can take unpaid leave for up to 21 days to perform Hajj, provided they have completed one year of service.
Regulations on public holidays and leave entitlements
Employees are entitled to official UAE public holidays with full pay. Key holidays include Eid Al Fitr, Eid Al Adha, and National Day. In total, these holidays amount to approximately 14 days annually, depending on lunar calendar dates.
For both public and private sector employees, these entitlements are mandatory. In cases where employees are required to work during public holidays, they are compensated with an alternate day off or receive overtime pay equivalent to 150 percent of their regular wage.
Emiratisation requirements and quotas
Emiratisation is a strategic initiative by the UAE government aimed at increasing the participation of Emirati nationals in the private sector workforce. This policy reflects the nation’s commitment to diversifying its economy and reducing its reliance on expatriate labor. By integrating more UAE nationals into the private sector, Emiratisation seeks to equip Emiratis with valuable skills, boost economic productivity, and ensure sustainable employment opportunities for local citizens.
Although Emiratisation efforts have been ongoing for years, significant legal reforms were introduced in 2022 to bolster compliance and expand the program's reach. Under Ministerial Decision No. 279 of 2022 (the Emiratisation Decision), companies under the jurisdiction of the Ministry of Human Resources and Emiratisation (MOHRE) are required to meet specific quotas for employing Emirati nationals. Notably, companies operating in free zones, including the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM), are exempt from these requirements.
The Emiratisation program focuses on skilled roles and is structured to incrementally increase Emirati participation over time. For private sector entities employing 70 or more staff, the mandated representation of Emirati nationals began at 2 percent in 2022, rising annually by 2 percent, with a target of 10 percent by 2026.
Quotas for hiring Emirati Nationals
Quotas under the Emiratisation policy vary depending on company size and sector:
- Large companies (70+ employees): These companies must annually increase their Emirati workforce by 1 percent every six months, achieving a 10 percent target by 2026. For every 70 skilled employees (or fewer), at least one Emirati national must be employed.
- Mid-sized companies (20–49 employees): Starting January 2024, companies in targeted sectors are required to hire one Emirati national by 2024 and a second by 2027.
Non-compliance attracts escalating fines. Large companies failing to meet quotas are penalized AED 6,000 per unmet Emirati role in 2023, increasing by AED 1,000 annually. Mid-sized companies face penalties of AED 96,000 for non-compliance in 2024 and AED 108,000 in 2027.
Employers who meet or exceed the 10 percent target are exempt from fines, providing a financial incentive for compliance. Additionally, existing Emirati employees before the introduction of these policies do not count toward new quotas, emphasizing fresh hires.
For businesses, the Emiratisation policy demands a proactive approach to workforce planning. Companies must invest in recruiting, training, and retaining Emirati talent to meet the quotas. This often involves partnerships with government programs, such as Nafis, which supports private sector employers with incentives for hiring UAE nationals.
The introduction of semi-annual evaluations has added urgency to compliance, requiring companies to track and report progress more frequently. Non-compliance risks not only financial penalties but also reputational damage and potential restrictions on operations, as outlined in Ministerial Decision No. 296 of 2023.
Termination and employee protection
The UAE offers comprehensive protections for employees in case of termination. However, employers must follow legal procedures and ensure that terminations are justified and well-documented.
Onshore (Mainland UAE)
Employees, particularly UAE nationals, are afforded special protections against wrongful termination under Ministerial Decision No. 212 of 2018. For example:
- An exit interview report must be prepared and submitted to the MOHRE.
- Termination is not considered legitimate if it is based on non-gross misconduct, or if it can be demonstrated that a non-national employee has been retained in place of a UAE national for the same role.
- If a UAE national is terminated due to lodging a complaint or filing a claim, the termination can be challenged.
Should the MOHRE find the termination unjust, they can refer the case to the competent court and may suspend new work permits for the employer for up to six months.
Termination procedures for all employees
Employers are required to follow due process when terminating any employee, which includes providing proper notice, conducting exit interviews, and settling end-of-service benefits. Employers must also comply with the conditions outlined in the Labour Law, including calculating gratuity and any other outstanding entitlements.
Gratuity payments
Employees who have completed one year of continuous service are entitled to gratuity payments, which are calculated based on their final wage and years of service.
Labor dispute resolution
The UAE provides structured mechanisms for resolving labor disputes, ensuring fair treatment for both employees and employers. Labor disputes typically begin with internal processes, where employees and employers attempt to resolve disagreements through direct communication or mediation within the workplace.
If internal resolution fails, the matter can be escalated to the Ministry of Human Resources and Emiratisation (MOHRE), which plays a pivotal role in mediating and resolving disputes. The MOHRE offers an accessible and formal platform for addressing complaints, guiding parties toward amicable settlements or legal resolutions.
In specialized jurisdictions like the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM), employment disputes are resolved according to their respective employment laws and regulations, often involving court-based resolutions or mandatory mediation.
The MOHRE serves as the principal authority for labor dispute resolution in the UAE’s onshore jurisdiction. Employees and employers can file complaints through MOHRE's digital platforms or service centers, triggering a formal review process. The MOHRE typically acts as a mediator, seeking to resolve disputes amicably. However, unresolved cases may be referred to the labor courts, which have the authority to issue legally binding decisions. MOHRE's involvement ensures that disputes are handled efficiently while adhering to the UAE's labor laws.
Recent updates to labor dispute resolution processes in the UAE aim to enhance worker protections and streamline procedures. One notable change includes the continuation of salary payments during the dispute resolution period for employees in specific circumstances. This ensures financial stability for workers involved in prolonged legal processes, reflecting the UAE's commitment to safeguarding employee rights.
Furthermore, MOHRE has adopted advanced digital tools to expedite the complaint filing and resolution processes. For instance, disputes are now assessed promptly, with mediation sessions often scheduled within days of filing a complaint. These changes underline the UAE's dedication to maintaining a balanced and efficient labor market.
Decisions issued by MOHRE or labor courts are legally enforceable, provided they are finalized through the prescribed legal channels. Employers and employees are obligated to comply with these rulings, which can include financial compensation, reinstatement of employment, or other remedies as deemed appropriate. In the DIFC and ADGM, settlement agreements and arbitration outcomes are also enforceable under their respective legal frameworks, provided they meet specified conditions, such as written consent and opportunities for legal advice.
Employee data protection requirements
The UAE places a strong emphasis on safeguarding employee data through Federal Decree-Law No. 47 of 2021 on Personal Data Protection (the Data Privacy Law). This legislation applies to all individuals residing or working in the UAE, including the private sector workforce. It mandates that personal data processing must be transparent, purposeful, and limited to what is necessary for the fulfillment of specific objectives.
Additionally, similar regulations are enforced within free zones, such as the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM), under their respective data protection laws.
The Data Privacy Law requires employers to secure the explicit, unambiguous consent of employees before processing personal data, except in specific circumstances. Exceptions include instances where the data processing is necessary to perform a contractual obligation, comply with UAE laws, or involves data already made public by the employee.
Employers in the UAE are considered data controllers and bear significant responsibility for protecting employee information. This includes implementing robust data security measures to prevent unauthorized access, breaches, damage, or alteration of personal data.
Employers are also required to preserve the confidentiality and privacy of employee data and maintain comprehensive records of all personal data processed.
Furthermore, employers must provide clear privacy notices to employees, detailing the purposes of data collection, the entities with which data will be shared (both within and outside the UAE), and the security measures for cross-border data transfers. Transparency is a cornerstone of compliance, ensuring employees understand how their data is handled.
Employees, as data subjects under the UAE’s Data Privacy Law, enjoy several rights concerning their personal information. These rights include:
- Access to their personal data held by employers.
- The ability to request data corrections or erasure ("right to be forgotten").
- Objection to certain types of data processing, such as automated decision-making or marketing activities.
- Restriction of data processing in specific cases.
- The right to transfer their data to another controller.
In free zones like DIFC and ADGM, similar rights are guaranteed, with additional obligations for employers to ensure that employees can exercise these rights without incurring costs.
Compliance with International Data Protection Standards
While the UAE’s Data Privacy Law aligns closely with international benchmarks, such as the EU's General Data Protection Regulation (GDPR), it also accounts for regional nuances. The emphasis on clear employee consent, transparency, and robust data security mirrors global best practices. However, the absence of executive regulations under the UAE’s Data Privacy Law has left certain details open for interpretation, highlighting the need for further clarification in the near future.
Employers operating in the UAE must proactively adopt practices that meet both domestic legal requirements and international standards, especially if they handle cross-border data transfers.
Retirement age
In the United Arab Emirates (UAE), the retirement age varies based on the employment sector and specific regulations. The minimum retirement age for Emirati employees who resign is set at 49 years, provided they have completed at least 20 years of service. This change was implemented to encourage longer service while allowing earlier retirement options under specific conditions
This was established under various labor laws, including the Federal Decree-Law No. 33 of 2021, which allows for flexibility based on individual circumstances such as work nature and experience
As of January 1, 2025, the retirement age for public sector employees will be 63 years for men, 58 years for female civil servants, and 55 years for female workers. This marks a gradual increase from previous ages set at 60 for men and lower for women.
The UAE labor law allows for extensions beyond the standard retirement age based on factors such as an employee's credentials, expertise, and the nature of their work. Employers can approve continued employment if they find it beneficial.
Employees over 60 can still apply for work permits up to the age of 65, reflecting a growing trend to retain experienced professionals in the workforce.
