UAE: New Changes to Labor Regulations Take Effect

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Jan. 28 — The United Arab Emirates has implemented three new decrees aimed at standardizing employment terms, enhancing employee mobility and improving transparency in the labor market. The decrees, which went into effect on Jan. 1, 2016, were published in September by the Ministry of Labor.

Contracts

The first decree focuses on providing greater protections to new employees to ensure that the terms and conditions promised during the recruitment period are actually delivered when they commence work. The decree requires employers to present offer letters to applicants using a new form, known as the “standard employment contract.” The form, which must be written in a language understood by the applicant, must be reviewed and signed by the prospective employee before it can be submitted to the Ministry of Labor for the issuance of a work permit. The terms of employment agreed to in the signed form cannot be altered unless the ministry agrees to the change.

The second decree, which deals with termination of employment, shortens the maximum duration of fixed-term contracts to two years and requires that these contracts contain notice periods of one to three months. The decree also establishes employer and employee liabilities for early termination of fixed-term contracts.

Work Permits

The third decree aims to give employees more flexibility in changing employers by easing labor bans on work permits. For example, a new work permit will be issued if the parties agree to terminate the contract during the course of its term, provided the employee has completed a period of no less than six months (if the employee has a high school diploma or higher, the six-month period is waived).

The decree sets out other instances in which work permits will be issued, including:

• when a fixed-term contract has expired and is not renewed,
• when the employer is shutting down,
• when the employment is terminated by the employer through no fault of the employee and
• when either party unilaterally terminates the employment relationship (given certain conditions are met).

 

To contact the reporter on this story: Jeff Florian at jflorian@bna.com

To contact the editor responsible for this story: Rick Vollmar at rvollmar@bna.com

For More Information

More information on royal decrees 764, 765 and 766 can be found at the UAE's Ministry of Labor website.

For more information on UAE HR law and regulation, see the UAE primer.