Last updated on: April 27th, 2022
Private sector employment in the UAE generally is governed by theFederal Law number 33 of 2021 (New Labour Law). The New Labor Law would apply across the UAE including each of the seven Emirates and its free zones except the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM).
Hours & Pay Regulations
Normal Working Hours
Working hours for employees cannot exceed 8 per day or 48 per week.
The government authority in collaboration with the relevant authorities may increase or decrease the daily working hours for certain sectors or certain categories of employees as well as specify the work timings, breaks, and the hours during which working shall be prohibited for certain categories of employees in accordance with the categorization. The Regulation shall set out the working hours during the holy month of Ramadan.
Travel time – The commutation periods spent by the employee from the place of residence to the worksite shall not be calculated within the working hours, except for certain categories of employees to be determined by the regulations.
The legislation provides for different working models which can be agreed upon between the employer and employee, such as:-
- Full time – This working model involves working for one employer on a full-time basis.
- Part-time – This model involves working for one or more employers for a specific number of hours or days.
- Temporary Work – This kind of working model involves carrying out a specific type of work during a specific time period which ends with the completion of such work.
Under the flexible working model, an employee may agree to work for the employer with working arrangements depending on the circumstances and requirements of the work. This involves changing working hours or working days depending on the organizational requirements. Any other working model as may be specified by the regulations.
In case the employee requests to work remotely whether from or outside the State, the employer may approve such request and set the working hours of the employee accordingly. In the DIFC and ADGM weekly working hours cannot exceed, on average, 48 hours over a seven day period, unless the employer obtains the employee’s prior written consent to work longer hours.
During Ramadan, a Muslim employee shall not be required to work in excess of 6 hours each day. There should be no reduction in wages as a result of reduced working hours.
The employers shall be required to maintain records and registers with respect to employees for a minimum period of 2 years from the date of the end of service of the employee.
An employer shall maintain a correct record consisting of employee’s working hours, wages, payroll records, etc of each of his/her employees at the employer’s principal place of business during the employee’s employment period as well as for a period of 6 years in DIFC and 2 years in ADGM after the date of termination of employment.
The work performed beyond 8 hours per day or 48 hours per week is considered overtime.
Pay – An employee who performs overtime work is entitled to a premium of 25% on the regular wages. In case, the overtime work is performed between 10 pm and 4 am, the employee is entitled to a premium of 50% on the regular wages.
Note – The overtime shall be calculated as per the basic wage only. Basic Wage means the wage specified in the Employment Contract and paid to the employee in return for the work under the employment Contract whether on a monthly, weekly, daily, or piecework basis. Such basic wage shall not cover any other allowances or in-kind benefits.
Effective overtime working hours may not exceed 2 hours per day unless such work is necessary for the prevention of the occurrence of a colossal loss, a serious accident, or the removal or mitigation of the consequences thereof. However, the total working hours of employees shall not exceed 144 hours in any period of 3 weeks.
Overtime exemption – The executive regulations will determine the category of employees to be exempted from the provisions relating to working hours.
In ADGM, an employee who works in excess of 832 hours over a 4 month reference period (the Threshold) is entitled to overtime compensation. The overtime calculation can either be monetary, time in lieu, or a combination of both as may be decided by the employer.
Monetary compensation is payable in the below manner:
- An employee who works overtime is entitled to in addition to daily wages an amount payable at the rate of 25% of hourly rate or time in lieu as appropriate.
- For overtime worked between 9 pm and 4 am, the overtime compensation rate is 50% of the hourly rate or time in lieu as appropriate.
Overtime payments must be paid within 1 month of the 4 month period which they relate to. The overtime calculation for a period of fewer than 4 months will be done on a pro-rata basis. Employees in managerial or supervisory positions etc are not entitled to overtime compensation.
No employee may work more than 5 consecutive hours without one or more breaks in aggregate of not less than 1 hour. These breaks are not included as part of the employee’s working hours.
In ADGM, an employee whose working time is more than 6 hours is entitled to rest and prayer breaks of not less than 1 hour in aggregate, which an employee can take away from his/her workplace.
In DIFC and ADGM, an employee is entitled to a rest period of not less than 11 consecutive hours in each 24 hour period.
Employees shall be granted a weekly paid rest for a period of no less than 1 day as per the arrangement in the employment contract or the work regulations/bylaws. The government authority may also increase the period of weekly rest upon passing a resolution.
Work On Rest Days
An employee who performs work on a weekly rest day is entitled to a substitute day of rest or a premium of 50% on the regular wages for each hour of work on the weekly rest day. The employees may not be requested to work for more than 2 consecutive off days with the exception of the day employees (Day employee is an employee who is hired and paid by the day – on day to day basis ).
In DIFC and ADGM, an employee is entitled to an uninterrupted rest period of not less than 24 hours in each 7 day period. Friday, Saturday shall be the ordinary weekly rest days in DIFC.
Employees in the UAE are entitled to leave with full pay for the following 10 public holidays, the dates for most of which vary year to year according to the lunar calendar:
- New Year’s Day (Hejir) – 1 day
- New Year’s Day (Gregorian) – 1 day
- Prophet Mohammed Birthday Anniversary – 1 day
- Eid al Fitr – 2 days
- Eid al Adha and Arafat Day – 3 days
- Isra and Mi’raj – 1 day
- National Day – 1 day
Payment for working on a Public Holiday
An employee who performs work on a public holiday is entitled to a compensatory time off or a premium of 50% on the regular wages for the work performed on the holiday.
In DIFC, an employer shall pay an employee their daily wage for each Public Holiday. An employee who works on a Public holiday will receive in addition to their daily wage either: a day off in lieu of the public holiday worked, an amount equal to the employee’s daily wage for the public holiday work, or payment of a prorated amount of the employee’s daily wage based on the time period worked during the public holiday.
In ADGM, employees are entitled to the national holidays that are announced in the UAE and which fall on a working day. However, such leave can be replaced by –
- a day in lieu;
- a payment in lieu; or
- a prorated amount relating to the period of time worked, where each of the employers and the employee agree in writing.
An employee is entitled to paid annual leave which is not less than:
- 30 days for each year of service;
- 2 days for each month in cases where the term of service was more than 6 months and less than 1 year;
- Leave for the parts of the last year of work in case the employee’s service ended prior to availing the annual leave balance.
A part-time employee shall be entitled to annual leave in accordance with the actual number of working hours spent at work. The period of such leave shall be specified in the employment contract of the employee.
Timing of Annual Leave
Employees shall take their annual leave in the same leave year. This means that the employees shall have to make use of their earned annual leave in the year in which it falls due.
Carry Forward of Leave
Upon the employer’s approval and in accordance with the regulations applicable within the organization, the employee may carry the annual leave balance either in full or in part to the following year. The employer may not prevent the employee from taking the annual leave accrued for more than 2 years unless the employee wishes to carry forward or receive cash payment against such annual leave balance.
In DIFC and ADGM, an employee who has been employed for at least 90 days is entitled to paid vacation leave of 20 workdays in each vacation leave year. An employee is entitled to carry forward up to 5 workdays of accrued but untaken vacation leave into the next vacation leave year for a maximum period of 12 months after which any unused vacation leave shall expire.
In ADGM, an employer shall allow the employee to take a vacation in periods of 1 week or more. Vacation leave cannot be converted into sick leave if an employee is sick during any period of vacation leave.
Annual Vacation Pay
An employee is entitled to wages during the period of annual leave.
In DIFC, an employee is entitled to be paid for their daily wage during vacation leave. An employee shall not be provided any payment in lieu of vacation leave unless otherwise agreed by the employee in writing.
Public Holiday during Annual Vacation
Public holidays falling during the annual leave of an employee shall be included in the vacation leave and which shall be considered as part of annual leave unless otherwise provided by the employment contract. In DIFC and ADGM, vacation leave is exclusive of Public holidays to which an employee is entitled.
Termination of Employment
An employee will be entitled to payment upon termination of employment for the amount of annual leave unused, and this payment shall be calculated using basic pay only.
In DIFC and ADGM, an employer shall pay the employee an amount in lieu of vacation leave accrued but not taken, up to and including the termination date at the employee’s daily wage rate.
In cases, where the employee has taken more vacation leave than has accrued at the termination date, the employer shall be entitled to deduct an amount equal to the employee’s daily wages from any payments due to the employee on the termination date.
Vacation leave during the first year of employment in DIFC and ADGM
An employee’s vacation leave accrues during an employee’s first year of employment on a monthly basis at the rate of 1/12th of the employee’s annual entitlement to vacation leave. During the first year of employment, the amount of vacation leave an employee may take is limited to the remaining amount of vacation leave accrued by the employee at the time of taking such vacation leave.
Entitlements under other leaves provisions in DIFC and ADGM
When an employee is entitled to a rest period, break, special leave, vacation leave, sick leave, or parental leave, the employee may elect to take the more favorable leaves but will not be entitled to both.
The new labor law has introduced the concept of minimum wages. The law states that labor relations will set a minimum wage to be determined and announced by the cabinet following a proposal by the Minister of Human Resources in collaboration with the relevant authorities.
An employee who sustains an illness not caused by the occupational injury shall inform the employer by no later than 3 working days. Employees are not entitled to paid sick leave during the probationary period. However, the employer may grant unpaid sick leave based on the medical report.
After the probationary period, an employee is entitled to annual sick leave not exceeding 90 consecutive or non-consecutive days for every year of service. The first 15 days of sick leave are with full pay, the next 30 days at half pay, and any subsequent periods without pay.
In DIFC and ADGM, an employee is entitled to sick leave of 60 consecutive or intermittent workdays in aggregate in a 12 month period. An employer shall provide sick pay to an employee at 100% of the employee’s daily wage for the first 10 workdays of sick leave; and 50% of the employee’s daily wage for the next 20 workdays of sick leave and 30 workdays without pay taken during a 12 month period.
An employee shall not be entitled to receive any wage for any additional sick leave taken in the same 12 month period. In case, an employee takes more than an aggregate of 60 workdays of sick leave in a 12 month period, the employer may terminate the employment with immediate effect. This does not apply in cases, where the employee takes sick leave on account of a disability.
In ADGM, employees with a contract of employment for 1 month or less are not entitled to sick pay.
Employees are entitled to 60 days of maternity leave of which 45 days will be fully paid and the rest 15 days shall be paid in half. Female employees shall also be entitled to additional maternity leave for a duration of 45 days without pay after the initial maternity leave is ended in case of any post-pregnancy complications or ailment in the newborn child.
Employees will now also be entitled to maternity leave and pay in the case of stillborn babies and newborn deaths. The new mothers of children in need of special care will also be able to take 30 days of paid leave after completing their initial maternity leave period which can also be renewed for another 30 days without pay.
Maternity leave would not be payable to such female employees who work for another employer during the authorized maternity leave. Employees on maternity leave continue to accrue other time off which she is entitled to if maternity leave had not been taken.
Breastfeeding break – Female employees after returning to work from maternity leave will now be entitled to one or two breaks for the purpose of breastfeeding for a period of no more than 6 months. The total duration of the break shall not exceed 1 hour.
Maternity leave in DIFC and ADGM
In the ADGM, female employees are entitled to 65 days of maternity leave following the birth or adoption of a child of fewer than 3 months old, if the employee has been continuously employed for at least 12 months.
In DIFC, a female employee who has been in continuous employment with her employer for at least 12 months including any period of transfer, immediately preceding the expected or actual week of childbirth and notifies her employer in writing at least 21 days before the day on which the employee proposes to begin her leave is entitled to leave up to 65 workdays for childbirth and adoption of a child of fewer than 5 years of age.
Vacation leave shall continue to accrue during maternity leave and can be taken consecutively to maternity leave subject to reasonable needs of the employer’s business. Any public holiday falling on a workday during the maternity leave period shall be treated as additional leave which will extend the maternity leave by the period of the public holiday.
Maternity leave pay in DIFC and ADGM
An employer shall pay maternity pay to an employee at 100% of the employee’s daily wages for the first 33 workdays of maternity leave and 50% of the employee’s daily wage for the next 32 workdays of maternity leave. An employee is not entitled to receive compensation in lieu of accrued untaken maternity leave.
In DIFC, a female employee who has resumed work after maternity leave and whose working time exceeds 6 hours in a day is entitled to nursing breaks of at least 1 hour in aggregate during the workday for a period of 6 months following the actual date of childbirth.
Employees are entitled to 5 working days of paid leave from the day of the birth of their child to 6 months of age. Such leave is to be availed either consecutively or non consecutively.
In DIFC, a male employee who has been in continuous employment for his employer for at least 12 months including any period of transfer, immediately preceding the expected or actual week of his wife giving birth and notifies his employer at least 8 weeks before the expected week of childbirth is entitled to a paid leave up to 5 workdays for childbirth and adoption of a child of fewer than 5 years of age. Paternity leave must be taken within a month from the date of –
- the child is born; or
- in cases where the child is adopted, the adoption date of the child.
Paternity pay in DIFC
An employee is entitled to payment of their daily wage for the duration of paternity leave and shall not be entitled to receive compensation in lieu of accused untaken paternity leave. Any public holiday falling on a workday during the maternity leave period shall be treated as additional leave which will extend the maternity leave by the period of the public holiday.
In ADGM, an employee is entitled to a minimum paid leave for 5 business days which shall be taken within 2 months from the date of birth of the child. The employer shall pay for the leave at the employee’s normal daily wage. An employee cannot receive compensation in lieu of paternity leave. In case of any National Holiday falling within the paternity leave shall extend the leave by the period of the national holiday.
Employees are entitled to a parental leave of 5 working days (paternity leave) from the day of the birth of their child to six months. Parental leave is a paid leave that can be applied for by the mother or father of the baby. Such leave is to be availed either consecutively or non consecutively.
In DIFC and ADGM, an employee who has completed at least one year of continuous employment with an employer is entitled to special unpaid leave not exceeding 21 days to perform Hajj pilgrimage once during the period of employment with the employer.
An employee who is an affiliate student or a full-time student at an accredited educational institution inside the State may be granted a paid study leave for 10 working days per year for the purpose of taking the examinations, provided that the employee has completed at least 2 years of service with the employer.
An employer shall provide for 5 days of paid leave for the death of a spouse and 3 days in case of the death of a parent, child, sibling, grandchild, or grandparent calculated from the date of the death.
An Emirati employee shall be entitled to a paid sabbatical leave to perform the National or Reserve Service, according to the laws applicable in the State.
The employee may upon receiving the employer’s consent take unpaid leave. However, such leave would not be taken into consideration for the purpose of calculating the term of service with the employer.
In DIFC, an employee who is pregnant or whose wife is pregnant and has made an appointment to receive antenatal care is entitled to take a reasonable period of paid time off at an hourly rate of wages during working hours in order to attend such an appointment
An employee who plans to adopt a child is entitled to take up to an aggregate paid time off for 8 hours during the working hours in order to attend adoption proceedings.
In ADGM, an employee who is pregnant and has made an appointment to receive antenatal care is entitled to take time off during the employee’s working hours which shall be paid at the employee’s hourly rate.