Employment Law in the UAE

Employment Contracts

Employment contracts in the UAE must be provided in writing in English and Arabic, and include essential details such as:

• Job Description: Outline of duties, responsibilities, and position.
• Salary: Clear breakdown of base salary, allowances, and bonuses (if any).
• Working Hours: Standard working hours and any overtime expectations.
• Leave Entitlements: Provisions for annual leave, sick leave, maternity/paternity leave, and other leave types.
• Termination Conditions: Required notice periods, end-of-service entitlements, and termination procedures.

Additional information:

• Employers must issue offer letter and Employment Contract through MOHRE (Ministry of Human Resources and Emiratization).
• The employer must sign an employment contract with the worker based on the agreed work pattern. This must be prepared as Offer Letter and Main Contract using the format specified by Ministry of Human Resources and Emiratisation (MOHRE) and the contract is digitally available in MOHRE Platform.
• MOHRE manages labour affairs in the UAE, ensuring fair employment practices and promoting Emiratisation. It regulates work permits, labour laws, and supports both employees and employers.
• In case of extending or renewing the contract, the new term(s) shall be considered an extension of the original term and shall be added to it while calculating the worker’s continuous term of service.

Types of Employment Contract:

• Limited Contract / Fixed Term Contract
  • Under this new law, all employment contracts must be fixed-term and cannot exceed three years in length, although they can be renewed. This move from unlimited contracts to fixed-term contracts is aimed at providing clearer expectations and obligations for both employers and employees.
• Part-Time Contracts
  • Part-time contracts are for employees who work fewer hours than full-time employees. Under this type of contract, employees work for one or more employers for specific hours or days.
• Temporary Employment contracts in UAE
  • Temporary contracts are for a specific assignment, ending when the assignment is completed. This
    type of contract is common in industries that require project-based work, such as construction or event management.
• Flexible Contracts
  • Flexible contracts allow employees to work hours or days that change depending on the employer’s business needs. This type of contract is suitable for employees who require flexibility in their work schedule, such as parents or student.

Frequency of Pay

Employers are required to pay wages at least once a month unless otherwise specified in the contract.

• Payments must be made through the Wage Protection System (WPS) for all private sector employees.
• Employers may pay more frequently (e.g. bi-weekly) but must follow the agreed terms in the employment contract.
• Delays in salary payments beyond 15 days from the due date may result in fines or penalties under MOHRE regulations.

Working Hours

Standard working hours under UAE law are:

• Maximum 8 hours per day or 48 hours per week (typically Sunday to Thursday or Monday to Friday).
• During Ramadan, working hours are reduced by 2 hours per day for all Muslim and non-Muslim employees.
• A break (minimum 1 hour) must be provided after 5 consecutive hours of work.
• Employees are entitled to at least one day off per week, usually Friday or Sunday, depending on the business sector.

Overtime

Overtime is any work performed outside the normal working hours. Key rules include:

• Employees can work up to 2 hours of overtime per day, subject to a total cap of 144 hours over 3 weeks.
• Overtime must be compensated as follows:
  • 125% of the hourly rate on regular workdays.
  • 150% of the hourly rate for night shifts (10 PM to 4 AM).
  • 150% of the hourly rate or compensatory time off for work on weekends or public holidays.

Some senior managerial or supervisory positions may be exempt from overtime entitlements, depending on contract classification.

Penalty Rates

UAE Labour Law does not formally use the term “penalty rates” like Australia, but compensation for working on rest days and public holidays is as follows:

• If an employee works on a rest day or public holiday, they are entitled to:
  • Basic salary + 50% premium, or
  • A day off in lieu on another working day.

Employers must record and compensate all extra hours accurately, and maintain transparent payslips.

Please note that all the information listed below are to be used as a general guideline. For more detailed accounts of UAE employment laws and regulations, please visit the official governmental websites.

Updated on: November 2025