The UAE, with its thriving economy and diverse workforce, has a well-defined set of employment laws that safeguard the rights of both employers and employees. These laws establish rules surrounding wages, employment contracts, and potential disputes, creating a friendly environment for business owners and the employees who work for them.
If you’re an investor hoping to form a business in the UAE, you’ll need a comprehensive knowledge of these laws. In this blog, we’ll explore the employment laws in Dubai in greater detail and shed more light on the rights and responsibilities of business owners and their staff.
Employment and Private Sector Employment Contracts
What is an employment contract? These agreements are established between an employer and their employee. These contracts establish the legal boundaries for any work that will be performed. However, depending on whether you’re working in the public or private sector, the details of these contracts may vary. Let’s take a look at private-sector employment contracts:
Private Sector Employment Contracts are typically categorized as full-time or part-time, depending on the hours worked. The laws surrounding the private sector were established in Federal Decree-Law No. 33 by the UAE government and have been in place since 2022.
These private-sector employment contracts are fixed-term contracts that can be extended or renewed as necessary. Even if the employer and employee have not renewed their contractual agreements, as long as they continue performing their duties, this contract is considered extended under the previous contractual terms.
Types of Work Arrangements in the UAE
Under UAE employment laws, workers are separated into one of several categories. These include:
Full-time employment is the conventional work arrangement where employees commit to a standard 48-hour workweek, as mandated by UAE labor rules in Dubai. This arrangement typically includes end-of-service benefits, annual leave, and health coverage, providing a comprehensive package for employees.
Part-time work arrangements offer flexible working hours, making them suitable for individuals with other commitments or responsibilities. Part-time employees enjoy reduced working hours while still being entitled to certain employment benefits, aligning with UAE employee rights outlined in labor laws.
Temporary work arrangements are prevalent in the UAE, especially for project-based roles. These engagements have a predefined duration, often tied to specific projects or seasonal demands. Employees under temporary work arrangements enjoy benefits in proportion to their employment duration, adhering to Dubai’s labor rules.
Flexibility is a hallmark of modern work arrangements. Flexible work allows employees to adjust their working hours, facilitating a better work-life balance. Dubai UAE Labor Law acknowledges the importance of flexibility, allowing employers and employees to negotiate schedules that suit both parties, ensuring mutual satisfaction.
The global shift towards remote work has also found resonance in the UAE. Remote work arrangements enable employees to perform their duties from locations outside the traditional office setting. This flexible setup is governed by UAE labor laws, ensuring that remote employees receive the same rights and benefits as their in-office counterparts.
Job sharing involves two or more employees sharing the responsibilities of a full-time position. Each employee works a portion of the standard workweek, contributing collectively to the role. This arrangement allows for a distribution of workload while adhering to the guidelines set by Dubai UAE Labor Law.
Probationary Period in the Private Sector
During the probationary period, employers have the opportunity to evaluate the skills, performance, and overall suitability of the new hire. Simultaneously, employees can assess the work environment, company culture, and job responsibilities to determine if it aligns with their expectations and career goals.
The duration of the probationary period is typically specified in the employment contract and can vary from one company to another. UAE private sector laws offer flexibility in determining the length of the probationary period, allowing companies to tailor this period based on the nature of the job and industry requirements.
Importantly, during the probationary period, employees are entitled to certain rights and protections stipulated by UAE labor laws. They are eligible for compensation, including salary and benefits, in line with the agreed terms in the employment contract. Moreover, any termination during the probationary period must adhere to the guidelines established by labor rules in Dubai, ensuring a fair and legally compliant process.
Public Sector Employment Contracts
Public sector employment contracts in the UAE adhere to a standardized framework to ensure transparency, fairness, and the protection of employers’ and employees’ rights and interests. Public sector employment contracts typically outline essential details such as job responsibilities, working hours, compensation, benefits, and leave entitlements.
Public sector employment contracts are broken down into the following categories:
Employees under full-time contracts commit to a standard working week, typically 48 hours, in alignment with UAE labor laws.
These contracts cater to individuals with other commitments or responsibilities, allowing them to contribute to public service while accommodating their varied schedules.
Whether it’s the implementation of new initiatives or handling short-term assignments, temporary contracts provide a structured framework for individuals to contribute to specific tasks.
Special contracts are designed to cater to unique situations, offering a flexible framework that addresses the specific needs of certain positions. These contracts may involve unique benefits, project-based terms, or other considerations tailored to the nature of the role.
Levels of Profession in the UAE
The Ministry of Human Resources and Emiratization (MoHRE) has divided UAE business into nine professional levels. These are:
Level 1: Legislators, Managers, and Business Executives
This level encompasses roles that involve strategic decision-making, policy formulation, and overall leadership within organizations. Individuals in Level 1 positions play a pivotal role in shaping the direction and success of their respective entities.
Level 2: Professionals in Scientific, Technical, and Human Fields
This level includes engineers, scientists, medical professionals, and experts in scientific or medical disciplines. Their work is characterized by a high level of expertise, innovation, and a commitment to advancing knowledge and technology.
Level 3: Technicians in Scientific, Technical, and Humanitarian Fields
Technicians in Level 3 bring the plans and concepts of Level 2 professionals to life. They are skilled practitioners responsible for implementing and maintaining the technical aspects of projects. From IT technicians to healthcare support staff, this level plays a vital role in the execution of innovative solutions.
Level 4: Writing Professionals
Level 4 encompasses writing professionals who contribute to effective communication and documentation. This includes journalists, editors, content creators, and other language experts. Their role is essential in conveying information accurately and fostering effective communication across various sectors.
Level 5: Service and Sales Occupations
Service and sales occupations form the bedrock of customer interactions. From retail professionals to customer service representatives, Level 5 ensures that businesses thrive by delivering excellent service and building lasting relationships with clients.
Level 6: Skilled Workers in Agriculture, Fisheries, and Animal Husbandry
Level 6 represents skilled workers who contribute to food production, environmental stewardship, and animal care. Their labor ensures a sustainable and thriving ecosystem.
Private Sector Working Hours
In most cases, private sector workers can expect to work 8-hour days and 48 hours per week, except for the month of Ramadan, where these hours are reduced by two. Of course, these hours can fluctuate based on certain economic factors and your chosen business activity.
Commute time is not included in these established hours, and employees are entitled to one or more breaks when working 5 hours or longer. These breaks must be shorter than an hour and are not factored in with the employees working hours.
Additionally, should employees need to work beyond their normal hours, they are entitled to pay equal to their base pay, plus 25%. This pay level can increase to 50% if overtime occurs between 10 PM and 4 AM.
Employees working on a day off are entitled to an additional rest day and are required to be paid standard pay plus 50% for the time worked.
Public Sector Working Hours, Leave Time, and Holidays
Throughout the seven emirates, working hours may vary slightly. For example, if you work for a federal government entity, you’ll be able to enjoy:
- Four and a-half day working week
- Eight-hour days from 7:30 AM to 3:30 PM, Monday-Thursday
- 7:30 AM to 12 PM Fridays
- Saturdays and Sundays are official weekend days
Government authorities in Ajman, Abu Dhabi, Umm Al Quwain, Ras Al Khaimah, and Fujairah utilize similar working hours. Sharjah officials, however, work four-day weeks, with Friday, Saturday, and Sunday being official weekend days.
Official Leaves and Holidays
Annual leave is a cornerstone of employee benefits, offering a designated period for rest and rejuvenation. As per UAE labor laws, employees are entitled to annual leave, which may vary based on the employee’s length of service with the company.
Recognizing the importance of employee health, sick leave allows employees to take time off when unwell. UAE labor laws outline the conditions and entitlements related to sick leave, ensuring that employees receive the necessary support during times of illness.
Study leave acknowledges the pursuit of knowledge and skills enhancement. This leave category supports employees in their educational endeavors, allowing them to pursue courses or certifications that contribute to their professional growth.
Parental leave recognizes the significance of family life. It provides employees with the flexibility to attend to family matters, ensuring the well-being of both parents and their children. The duration and conditions of parental leave are typically specified under labor laws.
Maternity leave is a crucial component of employee benefits, ensuring new mothers have adequate time to recover and bond with their newborns. UAE labor laws outline the duration of maternity leave, offering support and protection for working mothers during this significant life event.
Compassion leave acknowledges the need for time off during times of personal loss or bereavement. This type of leave allows employees to attend funeral arrangements or cope with the emotional impact of a loss.
Hajj Completion Leave
For employees who have completed the Hajj pilgrimage, this special leave recognizes the spiritual significance of the journey. It allows individuals to take the necessary time off to recover and reconnect after completing this religious obligation.
Umrah leave caters to individuals undertaking the pilgrimage, providing the necessary time for the spiritual journey. This leave reflects the UAE’s commitment to supporting employees in their religious observances.
Public sector employers are required to give employees time off during public holidays, including:
- Gregorian New Year on January 1st
- Eid Al Fitr (4 days)
- Arafat Day and Eid Al Adah (4 days)
- Islamic New Year
- Prophet Mohammed’s Birthday
- National Day (2 days)
UAE labor laws offer a host of benefits for employees, giving them access to
Employers must provide comprehensive health coverage to their employees, ensuring access to medical services and treatments. This coverage not only safeguards the health and well-being of workers but also contributes to a thriving and productive workforce.
Insurance Systems for Workers
These systems may include life insurance, disability coverage, and other forms of protection that offer a safety net for employees and their families.
This benefit provides financial assistance to individuals who find themselves temporarily unemployed, offering a safety net during periods of job transition.
Additional Labor Law Benefits
Employment laws in Dubai are designed to protect both employers and employees. They develop work environments that prioritize fairness, safety, and equality. Let’s look at a few of these specific rules and how they can benefit workers in the UAE:
Workplace Health and Safety
Ensuring a safe and healthy work environment is a cornerstone of workplace benefits in the UAE. Employers are bound by Dubai labor law for employees to implement stringent health and safety measures, including the provision of necessary safety equipment, regular training, and the establishment of protocols to prevent workplace accidents.
Non-compete restrictions are designed to protect the interests of both employers and employees. These provisions, outlined in employment laws in Dubai, prevent employees from engaging in similar or competitive work for a specified duration after leaving their current position.
Gender Equality and Discrimination
These laws ensure that all employees, regardless of gender, are treated fairly and have equal opportunities for career advancement.
These rules outline the procedures and consequences for employee conduct violations, ensuring that disciplinary actions are proportionate and consistent. Clear communication of disciplinary rules fosters an environment where employees understand expectations and consequences.
Work Permits and Visas
In the UAE, 12 types of work permits are granted to employees. These work permits include:
- A permit for recruiting someone from outside the UAE
- A permit for family sponsorship
- A permit for foreign employee transfers
- A temporary permit for employees who complete jobs within a specified timeframe
- A part-time permit for workers under a part-time contract
- A one-mission permit for employees taking on a temporary job
- A UAE/GCC national permit
- A student training permit
- A freelance permit for self-sponsored UAE foreigners
Employees hoping to secure a valid work permit must be able to provide:
- A valid trade license
- An authorized signatory from the company
The Cost of Work Permits
In most cases, you can expect a work permit to range between AED 300 and AED 3,500, depending on company size and classification. However, other fees and restrictions may apply, so working with a knowledgeable business consultant expert like MSZ can be highly beneficial if you’re seeking a work permit.
Don’t Let Legal Processes Hold You Up! Let MSZ Consultancy Handle All Your Business Needs
Whether you’re an investor starting a business in the UAE or want critical information on UAE employee rights and Dubai labor laws, our expert consultants can help. We have years of experience assisting entrepreneurs with company setup, legal frameworks, and handling day-to-day operations.
MSZ is proud to have a team of consultants with a deep understanding of ever-changing UAE business laws and regulations, enabling you to stay up-to-date in all areas of your business.
If you’d like to learn more about Dubai labor laws, give MSZ Consultancy a call at +971 52 544 1248 and speak with one of our consultants. We’ll be happy to review your goals, provide you with a free quote, and develop a custom roadmap for your financial success. Don’t let the red tape hold you back. Call MSZ Consultancy today.