The United Arab Emirates (UAE) is located in Asia. It is​ situated in the southeastern region of the Asian continent and in the eastern part of the Arabian Peninsula. It overlooks the Arabian Gulf on the north and northwest, borders the Kingdom of Saudi Arabia to the west and south, and the Sultanate of Oman to the southeast. Spread over 83,600 square kilometers, the UAE is a constitutional federation of seven emirates. It is a politically and economically stable country. The UAE hosts more than 200 nationalities doing business, living, learning, and touring the country.

 

*Please note that the official currency is the currency of remuneration when employed through WorkMotion in the United Arab Emirates.

Capitale :
Abu Dhabi City
Devise :
Emirati Dirham (AED; Dhs)
Langues parlées :
Arabic; English
Nombre d'habitants :
9.99 million (2021 est.)
Salaire minimum :
4,000 AED per month
Index du coût de la vie :
$$$$ (38 of 139 countries)
Payroll Frequency :
Monthly
Taux normal de la TVA :
5%
Croissance réelle du PIB :
3% (2021 est.)

Statutory Holidays

The national holidays mentioned below are valid for the year 2022.

Date
Holiday Name
Extra Information
January 1
Gregorian New Year’s Day
April 30 - May 4
Eid Al Fitr (29 Ramadan to 3 Shawwal)
Movable
July 8
Arafah Day
Movable
July 9 - 11
Eid Al Adha
Movable
July 30
Islamic New Year
Movable
October 8
Prophet Mohammed's birthday
Movable
December 1
Commemoration Day
December 2 - 3
National Day & National Day Holiday

Contract Sharing Time


The approximate time for sharing the contract with an employee in United Arab Emirates is 5 business days assuming no special requests or changes to our standard employment contract. Any such requests or changes would need to undergo internal and external review, directly leading to a time delay.

NOTE: This number is subject to change and is only an estimation of the Contract Sharing Time. The estimated Contract Sharing Time begins from the moment that WorkMotion has received all required information from both the client and the employee.

What You Need To Know


  • The UAE does not levy income tax on individuals.
  • Organizations can be penalized for failure to pay salaries on time.
  • Indefinite contracts of employment were abolished. All employment contracts are concluded for a fixed term not exceeding three years.
  • The minimum wage is 4,000 AED per month for UAE nationals with a Diploma or High School Certificate.

Labor Conditions


Working Hours

The maximum working hours for the private sector is eight hours per day, or 48 hours per week. During the holy month of Ramadan, the working hours must be reduced by two hours.

The worker must not work for more than five consecutive hours without a break or breaks of not less than an hour in total, provided that these periods are not included in the working hours.

 

Overtime

The employer may ask the employee to work overtime, provided the number of extra hours does not exceed two hours in one day. In all cases, the total working hours must not exceed 144 hours every three weeks.

If the nature of the work requires employees to work beyond the normal working hours, then they become entitled to a payment equal to normal working hours’ remuneration (which is based on basic salary) plus 25% of that pay. It increases to 50% if overtime is done between 10 pm and 4 am. This rule does not apply to workers who work in shifts.

Probation Period

A probationary period for the worker must not exceed six months. It is not permissible to appoint a worker under probationary period more than once for employer, and if the worker successfully passes the probationary period and continues to work, the contract becomes valid according to the agreed terms. This period must be counted within the term of service.

 

Termination Notice Period

Either party to the employment contract may terminate the contract for any legitimate reason, provided that the other party is notified in writing and work is performed during the notice period agreed upon in the contract, provided that such period is not less than 30 days and not more than 90 days.

Leave / Time Off

Annual Leave

A worker is entitled to an annual leave with full wage, of not less than:

  • 30 days for each year of extended service;
  • Two days for each month if the service term is more than six months and less than a year;
  • A leave for parts of the last year the worker spent at work if their service ended before using their annual leave balance.

Sick Leave

An employee is entitled to a sick leave of not more than 90 days per year, only after the end of the probationary period. The 90 days’ sick leave can be continuous or intermittent, and the salary is paid as follows:

  • Full pay for the first 15 days
  • Half pay for the next 30 days
  • No pay for the rest of 45 days.

During the probationary period, the employee may get sick leave without pay, subject to the approval of the employer and based on a medical report issued by the medical entity that stipulates the necessity of the leave.

Parental Leave

Parental leave is a paid leave that can be applied for by both parents of the baby. The duration of parental leave is five working days from the day of the birth of their child to six months. The same five days are also classified as paternity leave by the Ministry of Human Resources and Emiratization. 

 

Maternity Leave

Female workers are entitled to a maternity leave of 60 days, according to the following:

  • The first 45 days with full wage; and
  • The following 15 days with half wage.

An application for maternity leave must be done up to 30 days prior to the expected date of delivery. The female worker may, after using the maternity leave, be absent from work without a wage for a period not exceeding continuous or intermittent 45 days.

 

Paternity Leave

There is no provision for paternity leave that is separate from the five days provided for under parental leave.

Other Types of Paid Leave

 

Type of LeaveDuration
Bereavement leave
  • 5 days in case of death of the husband or wife
  • 3 days in case of death of the mother, father, son, brother, sister, grandson, grandfather or grandmother, starting from the date of death
Study leave
  • 10 working days per year in order to sit for exams provided that the service term at the employer is not less than two years 
Sabbatical leave to perform the national service
  • In accordance with the legislation in force in the State

Unpaid Leave

The worker may, after obtaining the approval of the employer, have unpaid leave. This leave must not be included in the worker’s service term at the employer or in the period of the contribution in the retirement scheme. The worker, who does not return directly to work without a legitimate reason after the end of the leave, is not entitled to wages for the absence period following the end of the leave.

 

Hajj Leave

Employees may be granted special leave for the performance of Hajj under the provisions that the leave:

  • Is given without pay
  • May not exceed 30 days
  • Is granted only once during the employment duration with the company.

Statutory Benefits

There is a social security regime in the United Arab Emirates that applies to qualifying UAE and other Gulf Cooperation Council (GCC) national employees only. Non-GCC nationals are not subject to social security in the United Arab Emirates.

Social insurance offers a variety of privileges to citizens, some of which are: healthcare, education, housing, and public services. It also covers disability or special needs for people of determination, occupational diseases, and injuries.

Employers pay 12.5% of payroll costs to the General Pension and Social Security Authority for UAE nationals. A higher rate of 15% is applied in the Emirate of Abu Dhabi. 

Health Insurance

Health Insurance regulations differ across the emirates.

 

Health Insurance for UAE Nationals
  • Abu Dhabi: Government provides full medical coverage for all UAE nationals living in Abu Dhabi.
  • Dubai: Has a health insurance program for the citizens in the emirate of Dubai that provides insurance coverage to citizens who do not currently benefit from any government health program in the emirate of Dubai.
  • Sharjah: Sharjah Health Authority oversees health insurance coverage for UAE nationals in the emirate of Sharjah.
  • Ajman: The government of Ajman provides all its employees with health insurance. 
Health Insurance for Resident Expatriates

 

Health Insurance for resident expatriates: The extent of coverage is determined by the employee’s salary, designation, etc. The extent of coverage and the type of policy/scheme would determine the cost of their medical services.

Other Insurances

Accident Insurance

 

The employer must in case the worker has a work injury or an occupational disease:

  • Bear the expenses of the worker’s treatment until they recover and are able to return to work or prove disability, in accordance with the conditions, rules, and procedures specified by the Implementing Regulation hereof.
  • If the work injury or occupational disease prevents the worker from performing work, the employer must pay the worker an amount equivalent to the full wage throughout the treatment period or for six months, whichever is less. If the treatment period exceeds six months, the worker obtains half wage for another six months, or until the worker is cured or the disability or death is proven, whichever is earlier.
  • If the work injury or occupational disease led to the death of the worker, their family is entitled to compensation equal to the basic wage of the worker for 24 months, provided that the compensation amount is not less than AED 18,000 and not more than AED 200,000. 
Unemployment Insurance

 

Insurance System for Employees in the Private Sector (Taa-meen)

Instead of keeping a bank guarantee of AED 3,000 per employee with the Ministry of Human Resources and Emiratization, employers can opt for Taa-meen, an Insurance System for employees in the private sector.

The insurance policy costs the employer AED 60 per year, per employee.

In case of the employer’s bankruptcy or failure to pay the employees’ benefits, the insurance provides a maximum insurance cover of AED 20,000 per employee against the following benefits in the workplace:

  • Unpaid entitlements
  • End of service benefits
  • Vacation allowance
  • Overtime allowance
  • Unpaid wages
  • Return air ticket
  • Work injury after it is determined by a court ruling

Public Pension

Registration in a Pension Scheme is compulsory for the UAE and GCC (Gulf Cooperation Council) nationals.

Employees are entitled to a retirement pension if:

  • They complete 20 years of service; and
  • Are at least 50 years of age

The amount of pension increases by 2% for every year the employee works after 20 years of service until they complete 35 years of service. When an employee completes 35 years of service, they qualify to get a pension equal to their salary. When an employee exceeds 35 years of service, they get a pension equal to three salaries for each year.

Other Statutory Benefits

End-of-service Gratuity

 

Employees are entitled to end-of-service benefits if they are not eligible for a pension.

The employee has to spend at least one year of service to be eligible for end-of-service gratuity. In the event of voluntary resignation, the eligibility period for gratuity is 19 years and 11 months. An additional working day for an insured is calculated as a whole month, and the insured is presumed to have completed 20 years of service, which is the qualifying period for the pension.

Disclaimer

The information contained in this Country Guide is provided for informational purposes only and should not be construed as legal advice on any subject matter. The contents of this Country Guide contain general information and may not reflect current legal developments or address your situation. You should not act or refrain from acting on the basis of any content included in this Country Guide without seeking the advice or representation of a licensed attorney. WorkMotion Software GmbH disclaims all liability for actions you take or fail to take based on any content included in this Country Guide.

Information provided in this Country Guide is provided “as is” without warranty of any kind, either express or implied, including without limitation warranties of merchantability, fitness for a particular purpose, or non-infringement. WorkMotion Software GmbH periodically adds, changes, improves, updates, or removes information without notice, and assumes no liability or responsibility for any errors or omissions in the contents of this Country Guide. This Country Guide may contain links to other websites. WorkMotion Software GmbH disclaims all liability for the privacy practices or the content of such websites.

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