Important Features You Should Know About UAE Labor LAW 2022

Notice period, gratuity, trial period, you have probably heard these words before or seen them in your employment contract. However, you may not know what these terms mean and how they can affect various aspects of your working life.

So, to understand these key terms, here are 10 important labor law related words and their meanings that anyone working in the UAE should know.

A) Trial period:- A trial period is a period of up to six months that new employees must undergo. According to the Executive Order on the Federal Labor Law of the United Arab Emirates no. 33 of 2021, on the regulation of labor relations is a period required by the employer to monitor the performance of the worker.

And also allows the worker to familiarize himself with his professional duties, which are described in the employment contract. The trial period is over, the employment contract is continued or terminated, in accordance with the provisions of labor law.

If the employer does not wish to continue with the employment contract, or if the employee wishes to end the service and not continue working, employment law provides guidelines on the length of the notice period that each party is required to to provide to the other.

B) Notice Period:- If you are considering quitting your job for a better opportunity, you are required to provide notice to your employer. A notice period is calculated from the moment the employee informs his employer of his decision to terminate the contract until the last working day, however, a notice period must be submitted within a specific period.

Article 43 of the UAE Labor Law provides that a notice period of 30 to 90 days must be given, regardless of which party (employer or employee) decides to terminate the employment contract.

According to labor law, “the notice period is specified in the employment contract, which must be observed by the contracting parties in the event that one of them intends to terminate the contract”.

C) Gratuity :- Gratuity is also called severance pay or severance pay. According to Section 51 of the UAE Labor Law highlighting severance pay for foreign employees working in the private sector, a full-time expatriate is entitled to severance pay if he completes his year of continuous service.

Tipping is a detailed process and depends on the length of service. To understand how an employee’s bonus is calculated, based on seniority.

D ) Basic Salary :- According to UAE labor law, your basic salary or base salary is the salary stipulated in your employment contract, which is paid in return for your work under the employment contract.

Although most of the time this salary is paid on a monthly basis, the new labor law also includes provisions for salaries to be paid on a daily, hourly or weekly basis on an ad hoc basis. It is important to note that your end-of-service benefits, mentioned above, are calculated on the basis of your base salary.

However, many employment contracts may include additional allowances for housing, transportation, or other incentives. Your total salary includes base pay and these allowances, which under labor law are provided to cover the cost of living, a percentage of sales, or a percentage of profits paid for what the worker is marketing, product or collection.

E ) Non-competition clause :- The non-competition clause is a provision of UAE labor law which protects the rights and interests of employers by ensuring that a worker does not move from one company to a competing company by taking trade secrets or confidential customer or company information.

However, the clause can only be implemented within certain guidelines defined by the Labor Law and subsequent Ministerial Orders.

For example, a non-competition clause can only be enforced in certain cases where the employee has access to sensitive company information, which can cause serious harm to the company if shared with competitors.

Under Section 47 of the UAE Labor Law, if an employer dismisses a worker because they have filed a complaint with the Ministry of Human Resources (MOHRE) or taken legal action against the employer, the validity of which has been proven, this dismissal is illegal.

Under the law, if a worker can prove, through a complaint filed with the MOHRE, that the employer arbitrarily terminated the worker, and the complaint was found to be founded.

F ) Arbitrary dismissal :- Arbitrary or unfair dismissal occurs when a worker’s employment contract is unlawfully terminated by the employer. Under Section 47 of the UAE Labor Act, if an employer dismisses a worker because they have filed a complaint with the Ministry of Human Resources and Emiratization (MOHRE) or brought an action in court against the employer, the validity of which is proven, then such termination is unlawful.

According to the law, if a worker can prove, through a complaint filed with the MOHRE, that the employer arbitrarily dismissed the worker, and the complaint is found to be founded by the Ministry, the worker will be entitled to compensation.

G ) Wage Protection System (WPS) :- it was first introduced in 2009 and is a system whereby wages are paid in full and on time. All employers registered with the MOHRE must register with the system and pay their employees’ wages through it, according to the due dates. The system is linked to employee bank accounts, which ensure that the salary is transferred directly to the employee.

H ) Vacation collection :- Vacation collection is a system that allows employees to convert unused vacation and collect it, on a salary basis, in accordance with labor law guidelines. However, it is important to note that in order to collect unused public holidays, certain conditions must be met which have been set out in the law.

Section 29(8) of the new UAE Labor Law states that employees who have accrued annual leave may request to be “paid in lieu of vacation in accordance with the statute of the institution and as specified by executive regulation of this Executive Order.

I ) Evasion Report :- Evasion Report If an employee is absent from work for more than seven days and has not not inform their employer of their whereabouts, the employer has the legal right to file an Unscheduled Work Abandonment (UWA), also commonly referred to as theft report. If the UWA report is found to be true by the department, it may result in a work ban for the employer.

However, certain provisions must be met in order for the employer to file such a complaint. In addition, a worker is also provided with the legal requirements that you must meet if you wish to rescind any such complaint that may have been filed.

J. Work ban :- A work ban is imposed when an employee violates the provisions of the UAE Labor Law or related ministerial resolutions and decrees or when he violates the terms and conditions stipulated in his employment contract.

According to the official website of the government of the United Arab Emirates uae, prohibition issues require investigation by a MOHRE forensic investigator who would invite both parties.

Employer and employee, to take their statements, judge the seriousness of the request and decide whether to accept it or not. The work ban cancels the employee’s work permit and if the employee was in possession of a company visa, this would also lead to the cancellation of the residence visa. However, according to, if the excluded person is in foster care with their parents or family.

They can keep the residence visa but cannot work or obtain another work permit for the duration of the ban. . If the deportee is outside the country, no new work permit will be issued to him before the expiration of the prohibition period.

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