New UAE labour laws: 3-year-job contracts, hiring overstayers and all you need to know

  DUBAI – UAE President Sheikh Khalifa Bin Zayed Al Nahyan has issued a federal decree on new labour laws for the private sector that will take effect beginning February 2, 2022. The updated laws cover three-year job contracts, hiring of those whose work contracts have expired but are still in the country, as well as mourning leaves. "The law comes in response to the rapidly-changing workplace amid technological advancements and the outbreak of Covid-19. It will apply to different work categories including full-time, part-time, temporary and flexy work among other categories,” said Dr. Abdulrahman Al Awar, Minister of Human Resources and Emiratisation. Here’s what we know:

Why was the law updated?

The new decree-law seeks to enhance the elasticity, resilience and sustainability of the labour market nationwide, as well as ensure protection of workers' rights.

Part-time work, temporary work and hiring those with expired work contracts

Among the key amendments provided by the decree law is the introduction of new types of work to allow employers to meet their labour requirements and benefit from their energies and productivity at the lowest operational cost through part-time work, temporary work and flexy work, as well as allow employers to hire those whose work contracts have expired, but who are still in the country, through easy and flexible procedures. Part-time work allows work for an employer for a specified number of hours or days. Temporary work is work whose implementation requires a specified period of time or is focused on work that ends with completion of a specified job. Flexible work is work for which working hours or work days change according to the volume of work and economic and operating variables of the employer.

Three-year contracts

The decree-law specifies a fixed-term contract as one that doesn't exceed three years, and it is permissible, upon agreement by the two parties, to extend or renew this contract for a similar or lesser duration once or more. The provisions of the decree-law shall apply to employment contracts of indefinite durations concluded in accordance with the Federal Law No (8) of 1980.

No more unlimited employment contracts

The law also stipulates that unlimited employment contracts are to be converted into fixed-term employment contracts, in accordance with the conditions, controls and procedures envisaged in this decree by law, within one year of the effective date of the existing contract and may be extended by the Cabinet for further periods as required in public interest.

Up to five days mourning leave, paternity leave

The updated law also provides vacations for the workers, including compassionate leave ranging from three to five days, according to the degree of the employee’s relationship with the deceased. In addition, paternity leave of five days shall be granted to private sector workers. Any other leave shall be decided by Cabinet.

Withholding of passports not allowed

The law stipulates the prohibition of withholding of official documents, such as passports, belonging to the workers and forcing him or her to leave the country at the end of an employment contract. This has been done to allow the worker to move to another establishment in the labour market. The worker shall also have the right to obtain his or her wages on the due date in accordance with the regulations approved by the ministry and according to the conditions and procedures as specified by the Executive Regulations of this decree-law.

Worker with expired work contract can move to another employer within six months

The decree-law permits the worker, in the event of expiration of the work contract, to move to another employer. A probationary period for the worker may not exceed six months, in accordance with the law's executive regulations The amendments include a provision, according to which, a worker is entitled to an end-of-service gratuity, in accordance with the legislation regulating pensions and social security in the country.

Paid weekly day off for all private sector workers

All private sector workers are entitled to a paid, weekly rest day, with the possibility of increasing the weekly rest day at the discretion of the employer.

Employer shall not abuse, threaten or force worker

In Article 74, the decree-law stipulates that the employer may not use any means that would force the worker or threaten him or her with any penalty or force him or her to work for the employer or force him or her to provide a service against his or her will. The law forbids sexual harassment, bullying or any form of verbal, physical or psychological violence against a worker by the employer, his or her superiors at work or colleagues.

Discrimination not allowed

It prohibits all forms of discriminations based on race, colour, sex, religion, national or social origin or disability that would scale down the possibilities of equal opportunity, prejudice equal access to or continuation of employment and enjoyment of rights.

Women to get same salary as men

The amendments stressed that while not violating the prescribed rights of working women stipulated in this decree, all provisions governing the employment of workers without discrimination shall apply to women, with an emphasis on granting women the same wage as men if they are doing the same work or work of equal value, which will be determined by a Cabinet decision.

Payment of salary in any currency

The law grants companies the flexibility to pay wages in UAE dirhams or in any other currency, according to the agreement between the two parties in the work contract.

End-of-service gratuity

The executive regulations of the law determine the conditions and control of work patterns and the obligations arising from each worker and employer, depending upon the type of employment, including what is related to end-of-service gratuity and as required by the interest of the two parties to the work contract.

Employer allowed to prohibit worker from competition

The decree-law also permits the employer to prohibit the worker from competing with the employer or participate in any competing project in the same business, should the work entrusted to the worker permit him or her to know the employer’s clients or access his or her trade secrets, provided that the condition is specified in terms of time, place and type of work to the extent necessary to protect legitimate business interests and the period of non-competition shall not exceed two years from the date of contract expiry.

Employer to pay costs of recruitment

The law also assigns the employer the responsibility to pay for the fees and costs of recruitment and not to collect the same from the worker either directly or indirectly.

End of service benefits

As per the law, a foreign worker who has worked full-time and who has completed one year or more of continuous service with an establishment, shall be paid end-of-service benefits calculated according to the basic wage, with a wage of 21 days for each of the first five years of service and 30 days for each subsequent year.

Terminating work contracts

The decree-law regulates the controls and conditions for terminating work contracts in a way that guarantees the rights of both parties. The amendments also strengthen the controls for the employment of juveniles, as well as with regards to the entitlements of the deceased worker, the requirements for occupational safety and other controls that guarantee the rights of both parties in a balanced manner.

Court fees waved for workers who file case

The decree-law waives judicial fees in all stages of litigation in all stages of litigation, execution and requests made by workers or their heirs, the value of which does not exceed Dh100,000. It regulates the obligations of the employer, the most prominent of which is the establishment of labour regulations, the obligation to provide adequate accommodation, protection and prevention, as well as train workers and help them develop their skills. In the meantime, the law regulates the workers’ obligations based on the terms of the employment contract and in accordance with duties, notably performing work during the specified times; abiding by work ethics and good conduct; keeping work secrets; developing job skills; committing not to work for another competing employer; vacating the labour accommodation within one month of expiry of employment contract and other obligations. ICA/WAM/Expat Media
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