The New UAE Labor Law in 2022: What You Should Know

Labour Law UAE

The UAE Government recently published Federal Labour Law No. 33 of 2021 (New Law), which updates Federal Labour Law No. 8 of 1980. (Previous Law).

The New Law will take effect on February 2, 2022, and will bring about several changes, some of which will have a considerable influence on current work arrangements. They set out below an overview of some of the key changes, their impact, and the next steps that employers should consider. Based on the guidance of the United Arab Emirates (UAE) Minister of Human Resources and Emiratization, the Cabinet will issue decisions categorizing employers and employees, as well as the privileges offered to each category, to order to promote competitiveness in the local labour market.

Types of work permits

The new law will promote the UAE labor market’s position as one of the most prominent and important global labour markets and will enhance its flexibility, efficiency, ease of work.

The law establishes contractual ties through the use of 12 different types of work permits and six different types of work patterns.

Dr. Abdul Rahman bin Abdul Manan Al Awar, Minister of Human Resources and Emiratization, said that the executive regulations of the decree-law recently approved by the Cabinet set the conditions and, depending on the type, regulations of work patterns and the obligations of both the employer and the worker.

Employment contracts

The major change under the new legal provisions is that employment contracts must now be limited.

The Executive Regulations outline the basic terms that must be included in an employment contract, such as the employer’s and employee’s information, position, date of joining, workplace, working hours, days of rest, probation period, contract duration, agreed salary (which must be paid through the Wage Protection System) and any allowances, annual leave, notice periods, and termination processes.

Within one year from the date of the law’s implementation, all private-sector employers must replace current MOHRE employment contracts with new employment contracts that reflect the changes. As a result, the timeframe for implementing these adjustments has been extended to February 1, 2023.

The approved tasks and duties are distributed among several staff. Under this model, the basic income and allowances owed to each employee are paid in proportion to the job performed by each employee. Employees under this work style will be considered part-time for purposes of the New Law and the Executive Regulations.

Employers and employees must follow the conditions of their employment contracts unless otherwise specified in the New Law or the Executive Regulations.

The number of working hours specified in the employment contract in a year is divided by the number of working hours specified in a full-time employment contract in a year, multiplied by 100 %, and multiplied by the amount of severance compensation included in a full-time employment contract.

If an employee is hired temporarily and their contract lasts less than a year, they will not be eligible for severance pay.

Work from Home

The employee and employer can connect remotely without the necessity for in-person attendance if all or part of the work is performed outside of the workplace. The working model is suitable for both full-time and part-time employment.

Special leave

An employee can only carry over half of their unused annual leave to the following year or agree with their employer to be compensated in place of the personal leave based on the income received at the time the leave eligibility was accrued. An employee will get a cash reimbursement after their employment for their statutory unused yearly leave entitlement calculated based on their basic wage.

A worker who has completed two years of employment with the same employer is entitled to 10 days of study leave under the new rule.

The new law also extends maternity leave by 45 days, with full pay for the first 45 days and a half pay for the next 15 days.

Another key change in the law is the new work model, which will improve the ease of doing business and offer greater flexibility in the labour market. Full-time, part-time, temporary, and flexible work are examples of these.

Prohibiting discrimination, forced labor, harassment, bullying

The New Labour Law retains and expands on the legislative guarantees put in effect under the Old Labour Law, which forbids discrimination based on race, color, sex, religion, national origin, socioeconomic origin, or disability.

The UAE’s new Labor Relations Regulation Law enhances the notion of equal opportunities by emphasizing equal access to work and enjoyment of their rights. “At the workplace, discrimination, bullying, assault, harassment, coercion, and threats are all illegal.”

Rest days

With the move of the UAE public sector workweek from Monday to Thursday, the weekly breaks should no longer be on Fridays, allowing private-sector employers to freely pick the working week for their employees.

Outline – Dismissal

The list of reasons set out in the New Labour Law that allow an employer to terminate an employee without notice has not been significantly expanded from the requirements of the Old Labour Law, and such reasons are essentially limited to misconduct and disclosure of the employer’s sensitive information. However, the New Labour Law expressly states that the employer must perform a written investigation with the employee in question before such dismissal, and the dismissal decision must be in writing and “justified,” a concept not defined in the legislation.

By law, when an employee is terminated for failing to perform the duties specified in the employee’s employment contract, the employer must first investigate the employee’s written performance mentioned earlier, but also give the employee two written warnings before dismissal to prove the employee’s failure.

*Please remember that this information is based on our perception of the new labour law notification. For more information, please read government publications on labour law notification.