Labor Matters Support
Expert Employment Solutions
A key aspect of complying with UAE labor regulations is ensuring that employment contracts and visas adhere strictly to applicable legal standards.
Properly structured agreements not only guarantee compliance with regulations but also bring clarity and security to both employers and employees, fostering a productive and balanced work environment.
Why is professional guidance crucial in labor matters?
Neglecting to comply with labor laws and associated regulations can result in serious repercussions, including
01
Fines – ranging from 5,000 AED to 1 million AED, depending to the nature of the breach.
02
Bank account restrictions – freezing of corporate accounts.
03
Operational disruptions – such as suspension of employment-related activities, including halting the issuance of work permits and limiting new hires.
04
Legal complications – which could lead to litigation or even criminal charges.
Hiring foreign nationals without a valid work permit or terminating a business when there are outstanding obligations to employees may result in a fine of AED 50,000. Repeated offences may result in imprisonment and an additional fine of AED 50,000.
Additional Considerations
Regulatory requirements may vary based on the company’s location of incorporation. These may include mandatory participation in employee benefit programs such as the DEWS (DIFC Employee Workplace Savings) or compulsory registration with the Wage Protection System (WPS).
Failure to comply with these obligations, including timely enrollment, is considered a severe regulatory breach and could result in the negative consequences mentioned earlier.
For exаmple, ignoring the requirement to have mandatory registration and processing of salary payments via WPS in the mainland UAE (whether the salary is paid in cash or by bank transfer) may result in the Ministry of Human Resources and Emirates (MoHRE) blocking a company's employment-related powers, such as hiring or firing employees. In addition, the UAE Central Bank may freeze the company's bank accounts if the violation is not remedied within a specified timeframe.
Expertise
Employment Agreements
When hiring employees in the UAE, free zones generally offer a standard employment agreement. However, this template often fails to cover the specific terms and conditions agreed upon by both the employer and the employee. This is why many companies turn to lawyers to draft bespoke employment agreements that better reflect their needs.
Management Agreements
These specific contracts outline the conditions of employment or services offered by senior executives, like managers. They usually contain provisions for extra responsibilities, personalized compensation plans, and limitations, making sure that the executives’ performance is in line with the company’s goals.
Share Option Plans
Share option plans are a growing corporate trend through which employees can acquire an ownership interest in a company. Such option plans have long been recognized as an effective instrument for retaining employees, stimulating employee productivity as well as aligning the interests of employees with the company's long-term success.
Other Services
