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Audit and protection of labor rights in the UAE
— Labor and tax legislation in the UAE is highly attractive to employers, primarily due to the absence of payroll taxes and mandatory contributions to funds such as pensions, health insurance, or social security. This stands in stark contrast to many other countries, where the total financial burden on salaries can reach 40-50%.
Nevertheless, employee labor rights in the UAE are strongly protected. Employers have specific legal obligations, and failure to comply with these responsibilities may lead to significant legal consequences.
Nevertheless, employee labor rights in the UAE are strongly protected. Employers have specific legal obligations, and failure to comply with these responsibilities may lead to significant legal consequences.
Pay wages through the WPS (Wage Protection System).
If an employer fails to pay employee wages through the mandatory Wage Protection System (WPS), they may be required to re-process the entire payroll for the entire period via the WPS. This requirement stands even if the employer can provide proof of actual payment through alternative methods, such as bank transfer receipts or signed employee receipts.
Apply for a resident work visa (Emirates ID). The employer is prohibited by UAE law from collecting any visa, processing, or associated costs from employees. All such fees must be borne by the employer.
Provide employees with mandatory health insurance.
Fulfilling the conditions of Emiratisation — hiring UAE citizens.
A fine of 50,000 AED (approximately $13,600 USD) per employee may be imposed for violations.
A fine can be imposed for violations.
A fine of 500 AED per employee may be imposed for each month of delay in providing mandatory health insurance.
Official employment: the employer is prohibited from allowing an employee to begin work, and the employee is prohibited from starting work, without first signing an employment contract and obtaining a work permit from the Ministry of Human Resources and Emiratisation (MOHRE).
Obligations of the employer:
Consequences in case of violation:
A fine of up to 50,000 AED (approx. $13,600 USD) per employee may be imposed for violations of labor regulations.
Violations of employee labor rights may also result in the company’s profile being blocked by the Ministry of Human Resources and Emiratisation (MOHRE). This will prevent the company from issuing new work permits or hiring any additional employees.
Our services in the field of labor law for employers:
Due diligence audit of labor relations;
Development of employment contracts, amendments to them, and termination of agreements;
Development of local regulations (work policies, data protection rules, trade secret regulations, etc.);
Analysis and mitigation of hiring and dismissal risks;
Guidance on protection of confidential information;
Advising on tax aspects of labor relations;
Consulting and documentation for personal data protection (third-party processing, cross-border transfers, etc.);
Advising on financial liability and compensation for damages.
Development of employment contracts, amendments to them, and termination of agreements;
Development of local regulations (work policies, data protection rules, trade secret regulations, etc.);
Analysis and mitigation of hiring and dismissal risks;
Guidance on protection of confidential information;
Advising on tax aspects of labor relations;
Consulting and documentation for personal data protection (third-party processing, cross-border transfers, etc.);
Advising on financial liability and compensation for damages.
Find out the cost and other details
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