UAE Labour Law: Compliance for Employers (2026 MOHRE Guide)

UAE Labour Law provides the framework for employment relationships across much of the private sector, covering contracts, work permits, wages, working hours, leave, workplace protections, termination and end-of-service benefits. For businesses, following these rules involves more than issuing compliant contracts. Payroll, attendance, leave, employee records, workplace policies and offboarding procedures must also be managed consistently.

In 2026, salary administration requires particular attention following changes to the Wage Protection System (WPS), while Emiratisation requirements and minimum salary rules for Emirati employees have also been updated. This makes regular reviews of employment and payroll processes important for businesses operating in the UAE.

This guide explains the main areas organisations should review to support compliance with UAE employment regulations and current Ministry of Human Resources and Emiratisation (MOHRE) requirements.

What Is UAE Labour Law?

The main framework governing private-sector employment is Federal Decree-Law No. 33 of 2021 on the Regulation of Labour Relations, together with its implementing regulations and amendments. It came into effect on 2 February 2022, replacing Federal Law No. 8 of 1980.

The legislation covers areas including:

• Employment contracts and work arrangements

• Work permits

• Wages and salary payments

• Working hours and overtime

• Leave and public holidays

• Employee records

• Workplace health and safety

• Disciplinary procedures

• Employee protection

• Termination

• End-of-service benefits

• Labour disputes

The framework applies broadly to private-sector businesses and workers, although some categories are governed by separate legislation. Financial free zones such as ADGM and DIFC also have their own employment regulations.

Who Does the Law Apply To?

Federal Decree-Law No. 33 of 2021 generally applies to private-sector establishments and their employees, whether UAE nationals or expatriates.

Certain categories are excluded from its scope and may be governed by different rules. These include some government employees, members of the armed forces, police and security authorities, and domestic workers.

Businesses operating in a specialised free zone should confirm which employment framework applies before relying on federal provisions.

UAE Labour Law Compliance Checklist

A practical review should cover:

• Employment contracts and work permits

• Employee classifications and work arrangements

• Probation procedures

• Salary calculations and WPS payments

• Working hours and overtime

• Annual and statutory leave

• Workplace policies

• Health and safety

• Emiratisation obligations, where applicable

• End-of-service benefit calculations

• Termination and final settlements

• Employee records and documentation

These areas should be monitored throughout the employment lifecycle rather than reviewed only when a worker joins or leaves.

Employment Contracts and Work Permits

Fixed-Term Contracts

The current private-sector framework uses fixed-term employment contracts. A contract can be extended or renewed for a similar or shorter period. If it expires without being formally renewed or extended while both parties continue performing their obligations, it is treated as renewed under the applicable rules.

An agreement should accurately reflect the actual arrangement and set out relevant terms such as:

• Job title and responsibilities

• Salary and benefits

• Working hours

• Place of work

• Employment model

• Leave entitlement

• Probation provisions

• Notice period

• Contract duration

Any material change to employment terms should also be documented appropriately.

Work Permits

A worker must have the appropriate work authorisation before commencing employment. Businesses should ensure that permit information, employment contracts, and government records remain consistent.

Before onboarding, it is good practice to verify:

• The appropriate work permit

• Identification information

• Job and salary details

• Required approvals

• Contract registration

When employment ends, the relevant cancellation and offboarding procedures should also be completed.

Work Models

The law recognises several arrangements, including:

• Full-time

• Part-time

• Temporary

• Flexible

• Remote work

• Job sharing

The selected arrangement should correspond with the actual working relationship. Certain entitlements for part-time and other arrangements may be calculated differently from those applying to full-time employment.

Probation Period

A probation period is optional and cannot exceed six months. Where the business ends employment during probation, at least 14 days' written notice is generally required. If the worker resigns to join another UAE employer, at least one month's written notice is generally required. 

Where the intention is to leave the UAE, at least 14 days' written notice generally applies.

Businesses should document probation reviews and decisions, particularly where employment is being terminated.

Working Hours, Breaks, and Overtime

Normal private-sector working hours are generally eight hours per day or 48 hours per week, subject to statutory exceptions.

During Ramadan, working hours are reduced by two hours per day. Workers who perform more than five consecutive hours of work are generally entitled to one or more breaks, which are not counted as working time.

Overtime

Additional working hours are subject to statutory limits and should be properly recorded. For ordinary overtime, the worker is generally entitled to the basic hourly wage plus at least 25%. For overtime performed between 10 p.m. and 4 a.m., the additional amount is generally at least 50%, subject to applicable exceptions.

Where work is performed on a designated rest day, the applicable substitute rest or additional payment should be provided in accordance with the law.

Attendance and payroll information should be reconciled so that approved overtime is accurately reflected in salary calculations.

Wages and WPS Compliance in 2026

The Wage Protection System is a central part of salary administration for covered private-sector establishments. It monitors wage payments through approved channels and provides authorities with visibility over salary disbursement.

From 1 June 2026, the updated WPS framework introduced a unified deadline: wages for a given month must be paid by the first day of the following Gregorian month. The previous flexibility around contractual due dates and the 15-day grace period has been removed.

The compliance threshold has also increased from 80% to 85% at both establishment and individual levels under the updated framework. This threshold is used for WPS compliance assessment; it does not remove a worker's entitlement to the full amount due under the employment relationship.

Payroll Controls to Review

A sound process should include:

• An internal payroll deadline before the WPS due date

• Verification of salary calculations

• Accurate bank and employee information

• Review of authorised deductions

• Monitoring of rejected or failed payments

• Reconciliation between contracts and payroll

• Retention of WPS submissions and payment evidence

Businesses using an external payroll provider should also maintain appropriate oversight. Delegating processing does not remove responsibility for meeting applicable obligations.

Repeated delays can lead to escalating measures, including warnings, restrictions on work-permit services, fines, and further enforcement action.

Annual Leave and Other Entitlements

Annual Leave

Workers are generally entitled to 30 days of paid annual leave for each completed year of service. Those who have completed more than six months but less than one year are generally entitled to two days for each month of service.

Leave should be scheduled and recorded properly. The official UAE guidance states that businesses should notify workers of scheduled annual leave at least one month in advance. Unused leave may be carried forward with the employer's consent and in accordance with applicable company rules and the implementing regulations.

When employment ends, unused accrued annual leave is generally payable based on basic salary.

Sick Leave

After probation, a worker may be entitled to up to 90 days of sick leave per year, subject to the statutory conditions.

The usual payment structure is:

• First 15 days: full pay

• Next 30 days: half pay

• Remaining 45 days: unpaid

A worker must generally notify the business of sickness within the required period and provide the relevant medical documentation.

Maternity Leave

A female worker is entitled to 60 days of maternity leave:

• 45 days at full pay

• 15 days at half pay

Additional leave can be applied for where pregnancy or childbirth results in an illness preventing a return to work. Further provisions apply where the child has a health condition or disability.

Parental Leave

Both parents are entitled to five working days of paid parental leave, which can generally be taken from the child's birth until the child reaches six months of age.

Compassionate Leave

Paid bereavement leave generally provides:

• Five days following the death of a spouse

• Three days following the death of a parent, child, sibling, grandparent, or grandchild

Study Leave

A worker who has completed at least two years with the same organisation may be entitled to 10 working days of paid study leave per year to sit examinations, subject to the applicable conditions.

Hajj Leave

Employees may qualify for unpaid leave to perform Hajj, subject to the statutory conditions and limits.

Public Holidays

Private-sector workers are entitled to paid public holidays announced by the UAE authorities. If a person is required to work during an official holiday, the applicable substitute rest day or additional payment must be provided under the law.

Workplace Rights and Protection

Compliance also extends to the working environment. The law prohibits discrimination on grounds including race, colour, sex, religion, national or social origin, and disability. It also addresses harassment, bullying, physical violence, and psychological abuse.

Businesses should have appropriate procedures covering:

• Workplace conduct

• Equal treatment

• Anti-harassment measures

• Grievances

• Disciplinary action

• Health and safety

• Reporting and escalation

Managers should understand these procedures and apply them consistently.

Internal Work Regulations

Businesses with 50 or more workers have additional obligations concerning internal work regulations, including disciplinary and grievance procedures.

These should be documented, made accessible, and applied consistently. Depending on the organisation, internal rules may also address attendance, leave, workplace conduct, flexible working arrangements and complaints.

The important point is not simply having policies in place, but ensuring that the procedures are communicated and followed when situations arise.

Non-Compete Clauses

A non-compete provision may be used where the nature of the role gives the worker access to information that could harm the organisation's legitimate interests.

The restriction should be limited according to factors such as:

• Duration

• Geographic area

• Type of work

It should not extend beyond what is reasonably necessary to protect legitimate business interests. Businesses should therefore avoid applying a broad, standard clause to every role without considering the person's responsibilities and access to sensitive information.

Emiratisation Requirements

Emiratisation is an important workforce obligation for qualifying private-sector companies. Businesses with 50 or more employees are subject to semi-annual Emiratisation growth requirements for skilled positions. For 2026, MOHRE has called on qualifying companies to achieve a 1% growth in their semi-annual Emiratisation target by 30 June 2026.

There is also a new minimum salary requirement for Emirati employees. From 1 January 2026, the minimum monthly wage is AED 6,000. Existing establishments were given until 30 June 2026 to adjust salaries to the new threshold.

Companies should monitor:

• Workforce size

• Skilled-position classifications

• Emirati representation

• Applicable targets

• Salary levels

• Nafis and MOHRE records

Failure to meet applicable requirements can affect Emiratisation calculations and employment-related services.

Health, Safety, and Summer Work

Businesses have a responsibility to provide a safe working environment and take reasonable measures to protect workers from occupational risks.

This includes appropriate:

• Safety procedures

• Risk controls

• Employee training

• Protective equipment where necessary

• Incident reporting

• Working conditions

Organisations with outdoor operations must also comply with the annual midday-break restrictions during the summer. The applicable dates and prohibited hours should be checked against the current MOHRE announcement each year.

Termination and Notice Periods

Employment can end through expiry of the contract, mutual agreement, resignation, or termination in accordance with the law.

For ordinary termination, written notice must generally be provided. The notice period must be at least 30 days and no more than 90 days, with the applicable period stated in the employment contract.

During the notice period:

• The employment relationship continues

• The worker remains entitled to their wage

• Failure to serve notice can result in notice-period compensation

• Where the employer terminates the contract, the worker is generally entitled to one unpaid day per week to search for another job, subject to the statutory conditions

Termination Without Notice

The law permits termination without notice in specified circumstances.

For example, this can apply where a worker:

• Uses forged documents or a false identity

• Causes substantial material loss through serious misconduct

• Is under the influence of prohibited substances during working hours

• Assaults the employer, manager, or colleagues

• Exploits their position for personal gain

• Seriously breaches workplace safety instructions

• Repeatedly fails to perform basic duties after the required process

• Is absent without a legitimate reason for more than 20 non-consecutive days in a year or more than seven consecutive days

Where dismissal without notice is being considered, a written investigation and a written, justified decision are required under the applicable procedure. Workers may also terminate without notice in specified circumstances, including serious breaches of contractual or legal obligations, certain cases of harassment or assault, fundamentally different work being assigned without consent, or serious health and safety risks.

End-of-Service Benefits

For eligible expatriate workers on full-time contracts, statutory gratuity generally becomes payable after at least one year of continuous service. The calculation is based on the basic salary, excluding allowances such as housing and transport. The standard calculation is:

• 21 days' basic salary for each of the first five years

• 30 days' basic salary for each additional year

The total gratuity cannot exceed the equivalent of two years' wages. Part-time and other work arrangements are calculated differently under the implementing rules.UAE nationals follow the applicable pension and social security framework rather than the expatriate gratuity calculation.

Alternative End-of-Service Savings Scheme

The UAE also offers a voluntary alternative End-of-Service Benefits Savings Scheme. Participating businesses make monthly contributions to approved investment funds, with the scheme operating as an alternative to the traditional gratuity system for participating employees.

Final Settlement and Offboarding

When employment ends, the final settlement may include:

• Outstanding salary

• Accrued unused annual leave

• End-of-service gratuity, where applicable

• Notice-related amounts

• Other contractual or statutory entitlements

The employer must generally pay outstanding wages, other entitlements and end-of-service benefits within 14 days of the contract's end. The offboarding process should also cover the relevant work-permit cancellation and employment records. Keeping a documented calculation of the final amount can help prevent disputes over salary, leave, or gratuity.

Employee Records and Documentation

Accurate documentation is an important part of maintaining a defensible compliance position.

Relevant records can include:

• Employment contracts

• Work permits

• Employee identification details

• Salary and payroll records

• WPS submissions

• Attendance information

• Overtime records

• Leave balances

• Disciplinary records

• Grievances

• Termination documents

• End-of-service calculations

• Final settlements

Information should be stored securely, and access should be restricted to authorised personnel.

Regular reconciliation is particularly useful because discrepancies between contracts, payroll, attendance, and government records can create avoidable issues.

Labour Complaints and Disputes

Workers can raise employment complaints through MOHRE channels when they believe their rights have not been met.

When a dispute arises, the business should gather the relevant documentation, including:

• Employment agreement

• Salary records

• Attendance information

• Leave history

• Written communications

• Disciplinary records

• Termination documentation

A clear internal grievance procedure can help resolve concerns early and provide a documented process for handling complaints.

Penalties for Non-Compliance

Breaches of employment regulations can result in financial and administrative consequences. Depending on the nature of the violation, these may include fines, restrictions on work-permit services, labour disputes, and other enforcement measures.

WPS breaches require particular attention in 2026 because the updated system provides for escalating action when salary payments are delayed. This can include warnings and restrictions followed by stronger measures depending on the circumstances and duration of the breach.

Businesses should therefore address identified gaps promptly rather than waiting for a complaint, an inspection, or a system alert.

How to Maintain Compliance in 2026

A practical approach is to make regulatory checks part of normal business operations.

Review Employment Documentation

Check contracts, work permits, job classifications, and employee information regularly. Update records when important employment terms change.

Strengthen Payroll Controls

Set an internal processing deadline before the WPS due date. Check salary calculations, deductions, employee bank information, and rejected transactions before final submission.

Track Leave and Attendance

Use reliable systems to monitor working hours, overtime, and leave balances. This helps keep attendance and payroll information consistent.

Monitor End-of-Service Benefits

Update gratuity calculations when basic salary or service duration changes rather than waiting until the final settlement.

Review Emiratisation

Monitor workforce composition, skilled positions, Emirati salary levels and applicable targets throughout the year.

Keep Policies Current

Review disciplinary, grievance, workplace conduct, and other internal procedures when regulations or business practices change.

Audit Regularly

A quarterly review can cover contracts, payroll, WPS, leave, end-of-service calculations, Emiratisation and employee records. Additional checks should be made whenever MOHRE introduces a relevant regulation, resolution, or procedural change.

Final Thoughts 

UAE employment compliance is an ongoing responsibility rather than a one-time review. Changes to payroll procedures, Emiratisation requirements and other employment rules mean that businesses need processes capable of keeping pace with regulatory developments.

A strong approach combines accurate contracts, reliable payroll controls, properly maintained employee records, and clear workplace procedures. Regular reviews can also help organisations identify discrepancies early and respond to changes from MOHRE more effectively.

For 2026, particular attention should be given to the updated WPS salary deadline, Emiratisation obligations, employee salary requirements, end-of-service calculations and final-settlement procedures. Businesses should verify requirements against the latest official guidance whenever a situation falls outside routine employment administration.