UAE: The New Labor Law Takes Effect

The United Arab Emirates (UAE) has issued Federal Law No. 33 of 2021, otherwise known as “the New Labor Law.” The New Labor Law is the most substantial change to the existing private sector Labor Law (No. 8 of 1980) since its inception and will replace the current Labor Law entirely. The changes are set to take effect on February 2, 2022. Some of the primary changes to be aware of include:

The New Labor Law expands on the grounds of discrimination in the workplace. Specifically, it prohibits discrimination against persons on the grounds of race, color, sex, religion, national origin, ethnic origin, or disability. It also prohibits employers from terminating an employee on the basis that she is pregnant or on maternity leave.

Under the Current Labor Law, there are no provisions that protect against labor, bullying, or sexual harassment in the workplace. The New Labor Law, however, prohibits sexual harassment or any verbal, physical or psychological form of bullying against an employee by the employer.

The New Labor Law introduces several different work categories, including full-time work, part-time work, temporary work, and flexible work.

Under the New Labor Law, all employees must be employed on fixed-term employment contracts. These contracts must not exceed three years. Employers will have 12 months from February 2, 2022, to transition all their current employees onto new contracts.

The New Labor Law sets a minimum wage for employees in the private sector. The amount has yet to be determined by the UAE Cabinet.

The Current Labor Law specifies Friday as the weekly rest day for all employees. The New Labor Law, however, does not specify a particular rest day. Instead, it simply states that all employees have the right to at least one rest day per working week

According to the New Labor Law, a female employee is entitled to a maternity leave of 60 days as follows:

• The first 45 days will full pay; and
• The next 15 days with half pay

The law also states that both male and female employees must receive a five-day parental leave to be taken up to six months following the child’s birth, concurrently or intermittently.

According to the New Labor Law, employees are entitled to the following:

• 5 days upon the death of a spouse
• 2 days upon the death of a parent, child, sibling, grandchild, or grandparent

The new law states that employees who have provided more than two years of service are entitled to 10 days of study leave.

Employees will now be required to take their holiday in the year it falls due. They are also entitled to a payment in lieu of unused leave on the termination of employment, which is to be calculated using basic pay only.

Contracts can be terminated on notice during the employment term for a legitimate reason. The notice period must not be less than 30 days and must not exceed 90 days.

Employers may only terminate an individual’s employment during the probation period by providing at least 14 days advance notice before the termination date. For resignation in the probation period, the employee must provide one month notice. However, if the employee is leaving the UAE, they must provide 14 days’ notice.