UAE unveils wage overhaul: New WPS sets benchmark for digital payroll

Image credit: WAM/Website

The Ministry of Human Resources and Emiratisation (MoHRE) in UAE has launched an upgraded version of the Wage Protection System (WPS), developed in collaboration with the Central Bank of the UAE and Al Etihad Payments, the national payments service provider owned by the Central Bank. The update is being implemented alongside several MoHRE-accredited financial institutions through their respective digital platforms, marking a significant step forward in the UAE’s ongoing push for smarter, more transparent labour market processes.

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The enhanced system was rolled out under the ministry’s partnership with e& Group, Botim, Al Ansari Exchange, Lulu Exchange, GCC Exchange, and Al Maryah Community Bank. According to MoHRE, the upgrade supports broader national goals to advance the UAE’s Zero Government Bureaucracy Programme and improve the ease of doing business. It also reinforces government efforts to adopt smart technology, strengthen market competitiveness, and protect the rights of all labour market participants.

System covers 99 per cent of private-sector workforce

The Wage Protection System currently covers more than 99 per cent of private-sector workers, whose salaries are processed through the system by their employers. Monthly wage transfers now exceed Dhs35bn, according to WAM.

In a press statement, the ministry said the upgraded version of the WPS makes it easier and faster for employers to manage salary payments, thanks to real-time data integration between MoHRE’s systems and financial institutions via the Central Bank. This integration allows users to rely on digital platforms to access smart, efficient, and secure salary-processing services.

Faster registration and improved data integration

MoHRE noted that the new version accelerates registration and verification procedures while enhancing communication between companies and relevant authorities. The system upgrade aims to boost operational efficiency, strengthen data integration, and solidify a secure and reliable digital environment for managing wage transfers.

The ministry described the update as a “notable leap” in wage management, driven by direct electronic integration. The enhanced platform enables employers to complete all wage-processing procedures digitally through automated data retrieval from MoHRE systems. It also improves salary-tracking accuracy and ensures timely wage disbursements to workers. These improvements, MoHRE said, support the UAE’s broader efforts to build a sustainable work environment and reinforce confidence in the national economy.

Strengthening governance and supporting compliance

The upgraded WPS also contributes to labour market stability by empowering supervisory bodies to enhance governance standards within the system. It ensures that employers comply with the Federal Decree-Law regulating employment relationships and with relevant regulatory decisions.

MoHRE stated that the system boosts labour market efficiency and agility through integrated digital financial services. It also provides an accurate and comprehensive database that supports planning and strategic decision-making.

Reducing disputes and enhancing transparency

According to the ministry, the upgraded system strengthens cooperation between government entities, banks, and financial institutions. This integration ensures better transaction governance, reduces wage-related labour disputes, and enhances transparency across the labour ecosystem. These improvements support the objectives of the ‘We the UAE 2031’ vision, which places competitiveness, innovation, and transparency at its core.

MoHRE emphasised that the upgraded WPS reflects the UAE’s commitment to maintaining a transparent, balanced, and fair work environment. The Ministry said the new system represents a comprehensive digital transformation, aligned with international best practices in labour administration and financial governance. It expands the number of participating financial institutions, improves transfer-processing efficiency, and deepens integration with financial institutions’ digital platforms, enabling companies to manage financial operations with ease.

Under UAE labour legislation, private-sector establishments are required to pay workers’ wages monthly, both in the amounts and at the times defined in employment contracts. Payments must be made through the Wage Protection System, which facilitates salary transfers via approved banks, financial institutions, and exchange houses.