UAE’s new wage protection law to be effective from October 3

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UAE’s Ministry of Human Resources and Emiratisation will start implementing the newly launched wages protection decree on Monday, an official said on Sunday.

The decree, launched by Saqr Ghobash, the Minister for Human Resources and Emiratisation, ensures employees’ full payment of their salaries on time.

  • The decree highlights companies employing over 100 workers.
  • Such companies must pay wages within a period not exceeding 10 days from the registered payday in the (WPS) wages protection system.
  • If they fail, the ministry will stop granting them any additional work permits starting from the 16th day of delay.

Strict measures against defaulters

According to the decree, if a company delays wages a month from the due date, the ministry shall inform the judicial authorities and other related parties to take all necessary punitive measures against the violating company.

Additionally, the ministry will halt other companies owned by the same employer, and forbid any upcoming projects foreseen by the same owner.

Furthermore, if a company continues to refrain wages, the ministry shall take necessary measures to use the company’s bank guarantee, then slapped by a downgrade to a third category company, plus enable their workers’ mobility options to other companies.

Administrative fines after 60 days

If the company fails to pay wages for 60 days from the due date, then administrative fines shall follow, in addition to registered fines for failing to pay wages a month from the due date, as stated above in the first scenario.

Administrative fines reach Dh5000 per worker’s delayed wage pay, stretching a maximum of Dh50,000 in events which include multiple workers protesting about deferred wages past 60 days.

Fortunately, the ministry lifts bans on violating companies allowing them to apply for new work permits only if they promptly paid deferred wages during the first late month, while the ban lasts for 60 days if companies fail to fund wages for more than two months.

  • According to the decree, companies that pay refrained salaries yet record such violations repetitively shall face a doubled duration ban.

On the other hand, if the ministry notes salary delays or refrains by a company that employs less than 100 employees, the current regulations shall apply, which includes work permits ban to fines to court referrals, however, only if the company fails to pay wages within 60 days.

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If the company repeats such violations over the span of one year, then, in this case, the ministry shall apply penalties declared for companies hiring over 100 workers.

The decree clearly states that the ministry shall not proceed with any transactions with companies that did not register in the (WPS), in addition, owners of these companies would be kept aside until the registration in the (WPS) is completed.

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