New UAE labour law for private sector goes into effect

The UAE’s new labour law for private sector employees, believed to be the most comprehensive reforms to date on the subject, has gone into effect starting Wednesday, February 2.

It addresses several issues including flexible work conditions, salary and employment contract structures, leave, recruitment costs, end-of-service benefits, and workplace harassment, among others.

It comes a few weeks after UAE President Sheikh Khalifa bin Zayed Al Nahyan issued the Federal Decree – Law No. 33 of 2021 in November amending the existing labour laws. With the new law, the Federal Law No. 8 of 1980 on Regulation Labour Relations has now expired.

Read: UAE issues sweeping new labour law for private sector

The UAE’ Ministry of Human Resources and Emiratisation (MoHRE) has revealed the number of registered private sector workers totalled 4,903,612 at the end of 2021, with employment highest in the 30-34 age group, followed by the 35-39 and 25-29 age brackets, according to state-run news agency WAM.

As of February 2, 2022, Federal Decree-Law No. 33 of 2021 on Regulation of Labour Relations will be effective for all private sector establishments, employers, and workers in the country, and the Federal Law No. 8 of 1980 on Regulation Labour Relations shall expire. #UAE #MOHRE pic.twitter.com/9SAfrvK8ML

— MOHRE_UAE وزارة الموارد البشرية والتوطين (@MOHRE_UAE) February 1, 2022

The number of private sector facilities registered with the ministry at the end of 2021, excluding companies in freezones, amounted to 373,966, an increase of 22,999 compared to 2020.

According to statistics, the construction sector leads in terms of the number of workers, amounting to 1,301,359, followed by the trade sector.

The new law’s amendments stipulate employers may not use any means of force against workers or use threats of penalty to make them work against their will. The law also prohibits sexual harassment, bullying or any verbal, physical or psychological violence against workers by their superiors or colleagues and any type of discrimination based on race, colour, sex, religion, nationality or disability.

In an effort to introduce gender parity in pay, the amendments aim to ensure women’s equality and prohibit any discrimination against them, ensuring women receive the same wage as men for the same work or for a job of equal value.

Moreover, the law introduces new work models including full-time, part-time, temporary and flexible work models. It also allows employers to hire those whose work contracts have expired, but who are still in the country, through easy and flexible procedures.

The term of fixed employment contracts must not exceed three years, which could be extended or renewed for similar or shorter periods any number of times.

The law stipulates workers are entitled to one paid leave day every week, with the possibility of additional weekly leave days upon the company’s own discretion. It also introduces a five-day paid bereavement leave on the death of a spouse and a three-day paid leave on the death of a parent, child, sibling, grandchild or grandparent, commencing from the date of the death. A five-day parental leave is also offered to both parents for childcare. Furthermore, workers are entitled to a 10-day study leave to pursue their education in accredited educational institutions in the country.

The law’s amendments include an article stipulating citizen workers are entitled to an end-of-service compensation upon the end of their service, in line with legislation regulating pensions and social security in force in the country. A foreign worker meanwhile who has worked full-time and who has completed one year or more of continuous service with an establishment, shall be paid end-of-service benefits calculated according to the basic wage, with a wage of 21 days for each of the first five years of service and 30 days for each subsequent year. It further waives judicial fees in all stages of litigation, execution and requests made by workers or their heir, the value of which does not exceed Dhs100,000.

The law regulates the duties of employers, such as providing adequate housing, means of prevention, and capacity and skills development training.

The law also places an emphasis on the duties and responsibilities of employees with regards to the new law. These include abiding by work ethics, keeping work secrets, committing not to work for another competing employer and vacating the labour accommodation within one month of expiry of employment contract, among other obligations.

From February 2, MoHRE will also issue 12 types of work permits. These work permit types include a student training and employment permit, which allows establishments registered with the ministry to train or employ a student in the country who has reached the age of 15, according to specific controls and conditions that guarantee an appropriate training and working environment, and a work permit for citizens and children from GCC countries that allows establishments registered with the ministry to employ citizens or people from the GCC.

A work permit can also be granted to Golden Visa holders upon the request of an entity registered with the ministry to employ a worker who holds this visa.