‘Can’t pay employees on time? Pay fine of 50,000 dirham’: UAE to employers

Under the Wages Protection System, strict measures will be taken against employers, who do not pay their employees on time

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If you are an employer in the United Arab Emirates and are unable to pay your employees on time, then you’ll have a lot to pay, literally. The Ministry of Human Resources and Emiratisation of UAE will impose a fine of 50,000 dirham on employers who fail to pay their employees for more than 60 days. If such employers fail to pay them within a month of the due date, they would be considered as refusing to pay them.

Under the Wages Protection System, which the UAE government has prescribed and all employers are required to subscribe to, special measures have been introduced to protect employees’ pay. For companies employing more than 100, one measure would be the discontinuation of issuance of work permits starting from the 16th day of delay from the salary date. Failing to meet the same would further attract action from judicial authorities. Such employers will also be debarred from registering any new company in the future. Their bank guarantees will be liquidated.

In a statement, the UAE government has said that the salaries of employees will be transferred to their accounts, in banks authorised by the central bank of the UAE to provide the service. According to the Ministry of Human Resources and Emiratisation, UAE, commitment to pay workers on time will contribute to enhancing their productivity and help build a stronger employer-employee relationship. The implementation of these measures is expected to also improve the legal practices in UAE’s labour market.

The Ministry of Human Resources and Emiratisation will not deal with companies that are not registered under the Wages Protection System.

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