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Labor Law

UAE Labour Law in Dubai and the UAE: Regulating the Work Environment

The UAE Labour Law (primarily based on Federal Decree-Law No. 33 of 2021 regarding the Regulation of Labour Relations, its Executive Regulations, and subsequent amendments) serves as the main legal framework governing the relationship between employers and employees throughout the UAE, including the Emirate of Dubai. This law aims to provide a stable, fair, and attractive work environment for both employees and employers, protecting the rights and obligations of both parties.

Key Aspects Covered by the Labour Law:

  • Scope of Application: It applies to all establishments and workers in the private sector within the UAE, including free zones, with some exceptions or specific provisions for certain free zones (such as Dubai International Financial Centre – DIFC, which has its own labour law).

  • Employment Contracts:

    • Fixed-Term and Unlimited Contracts: The new law has gradually phased out the concept of unlimited contracts, with the focus now on fixed-term contracts (which must not exceed 3 years, renewable).
    • Mandatory Contract Content: The contract must clearly state: type of work, start date, contract duration, basic salary, allowances, working hours, and probation period.
    • Probation Period: Can be up to a maximum of six months, and cannot be extended.

  • Wages and Allowances:

    • The law sets a minimum wage (though not yet universally applied) and ensures timely payment of wages.
    • It regulates allowances due to employees (such as housing allowance, transport allowance).

  • Working Hours and Leave:

    • Normal Working Hours: A maximum of 8 hours per day or 48 hours per week.
    • Overtime: Regulates how overtime pay is calculated.
    • Leave Types: Specifies types of leave due (weekly rest, annual leave, sick leave, maternity and paternity leave, mourning leave, study leave).

  • Termination of Employment:

    • Reasons for Termination: The law defines legitimate reasons for contract termination by either party (such as resignation, dismissal for gross misconduct, termination by the employer for legitimate reasons).
    • Notice Period: The law specifies the required notice periods for contract termination (typically 30 days, but may vary based on length of service and contract type).
    • End-of-Service Gratuity: The law determines how end-of-service gratuity is calculated based on years of service.

  • Settlement of Labour Disputes:

    • Amicable Stage: Before resorting to court, the employee or employer must file a complaint with the Ministry of Human Resources and Emiratisation (MoHRE) to attempt an amicable settlement.
    • Court: If amicable settlement fails, the Ministry refers the dispute to the competent labour court.

  • Worker Safety and Health:

    • The law obliges employers to provide a safe and healthy work environment for employees.

  • Expatriate Labour:

    • The law regulates aspects such as work permits, residency, sponsorship, and the employer’s obligations towards expatriate workers.

Its Importance for Dubai:

For Dubai, the Labour Law plays a vital role in:

  • Attracting Talent: By providing clear rights and protection for both expatriate and local workers.
  • Regulating the Labour Market: Ensuring fairness and transparency in the employer-employee relationship.
  • Boosting Productivity: By providing a safe and motivating work environment.
  • Dispute Resolution: Offering clear and effective mechanisms to resolve any disputes that may arise.

The UAE Labour Law is subject to continuous updates to align with international best practices and the evolving demands of the labour market, thereby ensuring a competitive and fair work environment.