Key changes in the UAE's new labour law 2024: what employers must know

The UAE's Federal Decree-Law No. 8 of 2024 (the updated Labour Law) governs working hours, end-of-service benefits and dispute-resolution procedures for private-sector employers across all emirates, setting out the minimum standards that must be observed in employment contracts and workplace policies.

Related Services: Explore our Labour & Employment Law Advisory and Employment Contracts services for practical legal support in this area.

WHAT ARE THE NEW LIMITS ON ORDINARY WORKING HOURS AND OVERTIME UNDER THE 2024 LABOUR LAW?

The law now caps ordinary working hours at eight hours per day or forty-eight hours per week, with a maximum of two hours of overtime per day, and requires overtime pay of at least 25 % above the basic wage for the first two overtime hours and 50 % for any additional hours (Federal Decree-Law No. 8 of 2024, Article 65)【https://www.uaelegislation.gov.ae】. Employers must obtain written consent from employees before scheduling overtime, keep daily records of hours worked, and provide rest periods of not less than one hour after every five consecutive hours of work. The law also introduces a flexible-working option allowing employers and employees to agree on a compressed workweek, provided the total weekly hours do not exceed forty-eight and daily rest requirements are met. Failure to comply with these provisions can result in administrative fines ranging from AED 5,000 to AED 50,000 per violation, as prescribed by the Ministry of Human Resources and Emiratisation (MOHRE) enforcement regulations.

HOW DOES THE 2024 AMENDMENT AFFECT END-OF-SERVICE GRATUITY CALCULATIONS?

End-of-service gratuity is now calculated based on the employee's last basic wage, with a rate of twenty-one days' wage for each of the first five years of service and thirty days' wage for each subsequent year, subject to a maximum of two years' total wage (Federal Decree-Law No. 8 of 2024, Article 53)【https://www.uaelegislation.gov.ae】. The amendment clarifies that periods of unpaid leave, sick leave exceeding ninety days, and unauthorized absences do not count toward service for gratuity purposes, while maternity leave, study leave approved by the employer, and national service are included. Employers must settle gratuity within fourteen days of the employee's last working day, issuing a detailed statement that outlines the calculation method, any deductions for outstanding debts, and the net amount payable. Non-payment within the stipulated period attracts a penalty of AED 1,000 per day of delay, enforceable through MOHRE's labour dispute committees.

WHAT CHANGES HAVE BEEN MADE TO DISPUTE-RESOLUTION MECHANISMS FOR EMPLOYMENT CONFLICTS?

The 2024 Labour Law introduces a mandatory pre-claim conciliation stage before any case can be filed with the Labour Courts, requiring parties to attend a mediation session administered by MOHRE within ten working days of a complaint being lodged (Federal Decree-Law No. 8 of 2024, Article 71)【https://www.uaelegislation.gov.ae】. If conciliation fails, the claim proceeds to the Labour Court, where the judge may issue a provisional order for payment of wages or benefits within seven days of filing. The law also expands the scope of summary proceedings to cover claims for unpaid salaries up to AED 100,000, allowing expedited resolution without full evidentiary hearings. Employers must retain all employment contracts, payroll records, and attendance logs for at least two years after termination to support their defence in these proceedings. Costs associated with filing a claim are now capped at AED 500 for employees, while employers may be ordered to reimburse these costs if found liable.

HOW DOES THE LAW ADDRESS PART-TIME AND TEMPORARY WORK ARRANGEMENTS?

Part-time employees are entitled to proportional benefits based on the ratio of their contracted hours to full-time hours, including leave accrual, overtime eligibility, and end-of-service gratuity (Federal Decree-Law No. 8 of 2024, Article 57)【https://www.uaelegislation.gov.ae】. Temporary workers hired through authorised agencies receive the same protections as direct employees regarding wages, working hours, and occupational health and safety, with the agency bearing joint liability for compliance. The law requires employers to issue a written part-time or temporary contract specifying the exact hourly rate, schedule, and duration, and to register such contracts with MOHRE within five working days of commencement. Violations attract fines of AED 3,000 per incorrectly classified worker and may lead to suspension of the employer's ability to sponsor new work visas.

WHAT RECORD-KEEPING AND REPORTING OBLIGATIONS ARE IMPOSED ON EMPLOYERS?

Employers must maintain electronic payroll registers that capture basic wage, allowances, overtime, deductions, and net payment for each employee, accessible to MOHRE inspectors upon request (Federal Decree-Law No. 8 of 2024, Article 78)【https://www.uaelegislation.gov.ae】. Additionally, a yearly labour compliance report detailing the number of employees, nationalities, work-related injuries, and any disciplinary actions must be submitted to MOHRE by the end of March each year. The law mandates that employee files contain a signed copy of the employment contract, passport and visa copies, Emirates ID, and any relevant permits, retained for a minimum of two years after the employment term ends. Failure to keep accurate records can result in administrative penalties of up to AED 20,000 and may affect the employer's eligibility for government contracts or free-zone licences.

FREQUENTLY ASKED QUESTIONS

What is the statutory notice period for terminating an unlimited contract under the 2024 Labour Law?
Either party may terminate an unlimited contract by providing thirty days' notice if the employee has less than five years of service, or ninety days' notice if the employee has five years or more of service (Federal Decree-Law No. 8 of 2024, Article 44)【https://www.uaelegislation.gov.ae】. The notice must be in writing and delivered personally or via registered mail; payment in lieu of notice is permissible if agreed upon in the contract.

Are employers required to provide health insurance under the new law?
Yes, employers must arrange private health insurance that meets the minimum standards set by the Dubai Health Authority or the relevant emirate health authority for all employees, regardless of nationality or contract type (Federal Decree-Law No. 8 of 2024, Article 32)【https://www.uaelegislation.gov.ae】. The insurance must cover inpatient, outpatient, emergency, and maternity care, and proof of coverage must be submitted to MOHRE upon request.

Can an employer change an employee's job location without consent?
A unilateral change of work location is permissible only if the employment contract expressly includes a mobility clause and the new location is within the same emirate; otherwise, the employer must obtain the employee's written consent (Federal Decree-Law No. 8 of 2024, Article 40)【https://www.uaelegislation.gov.ae】. Relocation to a different emirate without consent constitutes a breach of contract and may give rise to a claim for constructive dismissal.

What are the penalties for employing workers without a valid work permit?
Employing an individual without a valid work permit is punishable by a fine of AED 50,000 per worker, possible suspension of the company's trade licence, and potential criminal liability under the UAE Penal Code (Federal Decree-Law No. 8 of 2024, Article 84)【https://www.uaelegislation.gov.ae】. Repeat offenders may face increased fines and deportation of the unlawful worker.

How does the law protect employees against discrimination?
The law prohibits discrimination based on race, colour, sex, religion, national origin, social origin, or disability in hiring, remuneration, training, promotion, and termination (Federal Decree-Law No. 8 of 2024, Article 4)【https://www.uaelegislation.gov.ae】. Victims may file a complaint with MOHRE, which will investigate and, if warranted, refer the case to the Labour Court for compensation and corrective measures.

Is there a statutory limit on probation periods?
Probation periods may not exceed six months, and during this period either party may terminate the contract with fourteen days' notice (Federal Decree-Law No. 8 of 2024, Article 37)【https://www.uaelegislation.gov.ae】. The probation period must be clearly stated in the contract, and any extension beyond six months requires a new written agreement.

If your matter involves قانون العمل الإماراتي الجديد 2024 in the United Arab Emirates, you are welcome to request a consultation with Nour Attorneys. Our team can assess your position under the law currently in force and outline the options available to you. Request a consultation

This article is provided for general informational purposes only and does not constitute legal advice. Reading this article or contacting Nour Attorneys through this website does not create an attorney-client relationship; such a relationship arises only after a conflicts-of-interest check and a signed engagement agreement. Do not send confidential information through this website; information submitted before engagement is not protected by legal privilege. Past results do not guarantee future outcomes. The firm's lawyers practice in the jurisdictions stated in their individual profiles; this article addresses the law of the United Arab Emirates only.