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Understanding UAE Labour Law: Key
Points for Employers and Employees
The "UAE Labour Law" governs the rights and obligations of employers and employees in the United
Arab Emirates. It aims to create a balanced and fair working environment, ensuring both parties are
treated with respect and fairness. Here’s a comprehensive guide to understanding the key aspects of the
UAE Labour Law:
1. Legal Framework:
 Federal Law No. 8 of 1980: The primary legislation regulating labour relations in the UAE,
commonly known as the UAE Labour Law.
 Ministry of Human Resources and Emiratisation (MOHRE): The government body responsible
for implementing labour policies and resolving disputes.
2. Employment Contracts:
 Types of Contracts: There are two main types of employment contracts in the UAE - limited-
term (fixed) and unlimited-term contracts.
 Essential Elements: Contracts must include job title, job description, salary, working hours, and
duration of the contract (for limited-term contracts).
 Probation Period: Employers can set a probation period of up to six months, during which either
party can terminate the contract without notice.
3. Working Hours and Overtime:
 Standard Working Hours: The maximum working hours are eight hours per day and 48 hours
per week. During Ramadan, working hours are reduced by two hours per day.
 Overtime Pay: Employees are entitled to overtime pay at a rate of 125% of their regular wage.
For overtime between 9 PM and 4 AM, the rate is 150%.
4. Wages and Salaries:
 Minimum Wage: While the UAE Labour Law does not specify a minimum wage, it mandates that
wages should be agreed upon in the employment contract.
 Payment of Wages: Wages must be paid in the local currency (AED) and through the Wage
Protection System (WPS) for timely and transparent payments.
5. Leave Entitlements:
 Annual Leave: Employees are entitled to 30 calendar days of paid annual leave after completing
one year of service. For less than a year but more than six months of service, leave is calculated
at two days for each month.
 Sick Leave: Employees are entitled to 90 days of sick leave per year – the first 15 days fully paid,
the next 30 days at half pay, and the remaining 45 days unpaid.
 Maternity Leave: Female employees are entitled to 45 days of maternity leave at full pay,
provided they have completed one year of service. If not, they are entitled to 45 days at half
pay.
 Other Leaves: The law also provides for pilgrimage leave, compassionate leave, and study leave
under certain conditions.
6. End of Service Benefits:
 Gratuity Pay: Employees who complete one year of continuous service are entitled to end-of-
service gratuity, calculated based on their last drawn salary.
o Limited-Term Contracts: 21 days of basic salary for each year of the first five years of
service, and 30 days for each subsequent year.
o Unlimited-Term Contracts: Similar calculation but includes a notice period.
 Deductions: Any owed debts or advances can be deducted from the gratuity.
7. Termination of Employment:
 Notice Period: The notice period for termination is typically 30 days, unless otherwise stated in
the employment contract.
 Unlawful Termination: If an employee is terminated without a valid reason, they are entitled to
compensation.
 Resignation: Employees can resign, providing they adhere to the notice period stipulated in
their contract.
8. Dispute Resolution:
 MOHRE: Employees and employers can file complaints with the Ministry of Human Resources
and Emiratisation for mediation and resolution.
 Labour Court: If disputes are not resolved through MOHRE, they can be escalated to the Labour
Court for legal adjudication.
9. Health and Safety:
 Employer Obligations: Employers must ensure a safe working environment and adhere to
health and safety regulations to protect employees from workplace hazards.
 Medical Insurance: Employers are required to provide medical insurance for their employees.
Conclusion
The UAE Labour Law is designed to protect the rights of both employers and employees, fostering a fair
and equitable working environment. Understanding these key aspects can help ensure compliance and
promote harmonious labour relations. For detailed guidance and specific cases, it is advisable to consult
legal experts or the MOHRE directly.

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Understanding UAE Labour Law: Key Points for Employers and Employees

  • 1. Understanding UAE Labour Law: Key Points for Employers and Employees The "UAE Labour Law" governs the rights and obligations of employers and employees in the United Arab Emirates. It aims to create a balanced and fair working environment, ensuring both parties are treated with respect and fairness. Here’s a comprehensive guide to understanding the key aspects of the UAE Labour Law: 1. Legal Framework:  Federal Law No. 8 of 1980: The primary legislation regulating labour relations in the UAE, commonly known as the UAE Labour Law.  Ministry of Human Resources and Emiratisation (MOHRE): The government body responsible for implementing labour policies and resolving disputes. 2. Employment Contracts:  Types of Contracts: There are two main types of employment contracts in the UAE - limited- term (fixed) and unlimited-term contracts.  Essential Elements: Contracts must include job title, job description, salary, working hours, and duration of the contract (for limited-term contracts).  Probation Period: Employers can set a probation period of up to six months, during which either party can terminate the contract without notice. 3. Working Hours and Overtime:
  • 2.  Standard Working Hours: The maximum working hours are eight hours per day and 48 hours per week. During Ramadan, working hours are reduced by two hours per day.  Overtime Pay: Employees are entitled to overtime pay at a rate of 125% of their regular wage. For overtime between 9 PM and 4 AM, the rate is 150%. 4. Wages and Salaries:  Minimum Wage: While the UAE Labour Law does not specify a minimum wage, it mandates that wages should be agreed upon in the employment contract.  Payment of Wages: Wages must be paid in the local currency (AED) and through the Wage Protection System (WPS) for timely and transparent payments. 5. Leave Entitlements:  Annual Leave: Employees are entitled to 30 calendar days of paid annual leave after completing one year of service. For less than a year but more than six months of service, leave is calculated at two days for each month.  Sick Leave: Employees are entitled to 90 days of sick leave per year – the first 15 days fully paid, the next 30 days at half pay, and the remaining 45 days unpaid.  Maternity Leave: Female employees are entitled to 45 days of maternity leave at full pay, provided they have completed one year of service. If not, they are entitled to 45 days at half pay.  Other Leaves: The law also provides for pilgrimage leave, compassionate leave, and study leave under certain conditions. 6. End of Service Benefits:  Gratuity Pay: Employees who complete one year of continuous service are entitled to end-of- service gratuity, calculated based on their last drawn salary. o Limited-Term Contracts: 21 days of basic salary for each year of the first five years of service, and 30 days for each subsequent year. o Unlimited-Term Contracts: Similar calculation but includes a notice period.  Deductions: Any owed debts or advances can be deducted from the gratuity. 7. Termination of Employment:  Notice Period: The notice period for termination is typically 30 days, unless otherwise stated in the employment contract.  Unlawful Termination: If an employee is terminated without a valid reason, they are entitled to compensation.  Resignation: Employees can resign, providing they adhere to the notice period stipulated in their contract.
  • 3. 8. Dispute Resolution:  MOHRE: Employees and employers can file complaints with the Ministry of Human Resources and Emiratisation for mediation and resolution.  Labour Court: If disputes are not resolved through MOHRE, they can be escalated to the Labour Court for legal adjudication. 9. Health and Safety:  Employer Obligations: Employers must ensure a safe working environment and adhere to health and safety regulations to protect employees from workplace hazards.  Medical Insurance: Employers are required to provide medical insurance for their employees. Conclusion The UAE Labour Law is designed to protect the rights of both employers and employees, fostering a fair and equitable working environment. Understanding these key aspects can help ensure compliance and promote harmonious labour relations. For detailed guidance and specific cases, it is advisable to consult legal experts or the MOHRE directly.