Employment

Establishing employment relations properly, amending them in case of need and, if necessary, terminating them in a fair manner

Regardless of whether you are an employer or an employee, we support you in all labour-related issues, such as:

  • Drafting and reviewing employment contracts, bonus agreements and employee handbooks
  • Advising on individual employment questions, such as end-of-service benefits and non-competition clauses
  • Assisting with the cancellation of employment relationships by termination notice or settlement agreement
  • Coordinating visa-related matters

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Overview

From a European perspective, the labour laws of the United Arab Emirates ("UAE") can be considered rather employer-friendly. Amongst others, this assessment is based on the stipulations concerning the termination of employment and the fact that neither trade unions nor work councils currently exist.

Federal Decree-Law No. 33 of 2021 ("UAE Labour Law") forms the primary legal basis with regard to the relation between employer and employee since 02.02.2022.

When entering into an employment relationship, special attention needs to be paid to the drafting of the employment contract. Apart from local rules and regulations, legal requirements of the home country of the employer and the employee may have to be taken into consideration as well should the employee be seconded to the UAE.

The UAE Labour Law only provides for limited-term contracts. Existing unlimited employment contracts must be converted to limited-term contracts by 01.02.2023.

Provisions of the employment contract may only deviate from the UAE Labour Law if they are in favour of the employee.

During the employment relationship, the following aspects are significant, amongst others:

a. Salary

In general, the remuneration is divided into basic salary and various allowances.

There is currently no statutory minimum wage. However, the UAE Labour Law provides for the possibility of setting one by cabinet resolution.

b. Working Hours

The employee must be granted at least one day of rest per week. According to the UAE Labour Law, this day does not necessarily have to be on Friday. Therefore, a six-day workweek basically prevails in the UAE. However, most companies in the private sector are closed on two days of the week.

A four-and-a-half-day workweek was introduced for the public sector on 01.01.2022. Saturday and Sunday form the new weekend and Friday is a half working day. The changes are not binding on the private sector.

c. Public Holidays

Employees are entitled to full pay on holidays officially announced for the private sector. To date, these include, for example, the Christian New Year (1st January), the UAE National Day (2nd December), the Islamic New Year and the public holidays at the end of Ramadan.

d. Leave

An employee is entitled to a minimum of 30 calendar days annual leave provided his service exceeds one year. If the employee is employed more than six months but less than a year, the leave period amounts to two calendar days per month.

Amongst other, the employment relationship ends in any of the following cases:

  • The parties agree to terminate the contract.
  • The validity of the contract expires.
  • One of the parties serves notice of termination.
  • The employee dies or becomes wholly disabled.

An employee who completes one year or more of continuous service is generally entitled to gratuity at the end of his service. Furthermore, he may claim payment in lieu of holiday, reimbursement of repatriation costs and/or damages.

Further Information

Published on 22.03.2022

Published on 04.01.2022

Published on 18.12.2021

Published on 14.10.2021

Published on 18.04.2021

Published on 18.03.2021

Published on 11.01.2021

Published on 25.11.2020

Published on 03.11.2020

AHK Legal Newsletter September 2020

Published on 02.07.2020

Published on 02.04.2020

AHK Legal Newsletter March 2020

AHK Legal Newsletter June 2019

AHK Legal Newsletter December 2018

AHK Legal Newsletter September 2018

AHK Legal Newsletter October 2017

AHK Newsletter Law and Taxes, May 2015, p. 8 f.

AHK Newsletter Law and Taxes, August 2014, p. 10 f.

AHK Newsletter Law and Taxes, August 2013, p. 5 f.