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How to hire and pay employees in United Arab Emirates
Slasify
Jun 21, 2025
| Key Takeaways |
|---|
| 1. Payroll is monthly, and all employers must pay through the Wages Protection System (WPS). There is no statutory minimum wage. |
| 2. No personal income tax or local taxes are applied on employment income in the UAE. |
| 3. Standard working hours are 8 per day and 48 per week, with reductions during Ramadan. Overtime is paid at 125–150% depending on timing. |
| 4. Annual leave is 30 days for employees with 1 year of service. Sick leave is up to 90 days, paid or unpaid depending on duration. |
| 5. Maternity leave is 60 days with full or half pay depending on duration. Paternity leave is 5 days paid, and parental leave rules apply. |
| 6. Termination requires notice of 30–90 days or immediate if justified. Severance pay is based on length of service for foreign employees. |
| 7. Probation periods are up to 6 months, during which leave entitlements are limited and termination requires shorter notice periods. |
| 8. Public holidays total 14 days, with compensatory pay or time off if employees work on these days. |
Discover the global hiring and employment landscape in United Arab Emirates – serving as a gateway between East and West, the UAE offers a thriving business ecosystem with state-of-the-art infrastructure and strategic location.
Personal Income Tax
There are no taxes on employment income in the UAE.
Local Taxes
There are no local taxes on employment income in the UAE.
Statutory Contributions
Social security contributions to either the General Pension and Social Security Authority (GPSSA) or Abu Dhabi Retirement Pensions and Benefits Fund (ADRPF) are applicable to qualifying UAE and other Gulf Cooperation Council (GCC) nationals. The contribution rates for GCC nationals are determined by the social security regulations of their home countries.
| Contribution Base Floor | Contribution Base Ceiling | |
|---|---|---|
| GPSSA | AED 3,000 | AED 70,000 |
| ADRPF | AED 6,000 | AED 100,000 for New Active Members and AED 150,000 for In-Service Active Members |
Employer Contributions
| Contribution rate | Note | |
|---|---|---|
| GPSSA | 12.5%–15% |
The contribution rate of 12.5% shall apply for employees earning less than AED 20,000. Otherwise, the rate of 15% applies. This contribution is applicable to all employers in the UAE, |
| ADRPF | 15% | This contribution is applicable to all employers in Abu Dhabi only. |
Employee Contributions
| Contribution rate | Note | |
|---|---|---|
| GPSSA | 11% | This contribution is applicable to all employers in the UAE, except for Abu Dhabi. |
| ADRPF | 5%–11% |
Newly insured employees are subject to the contribution rate of 11%. This contribution is applicable to all employers in Abu Dhabi only. |
| Unemployment Insurance Scheme | AED 5–10 |
Those who earn up to AED 16,000 per month shall pay AED 5, while those who earn more shall pay AED 10. This is applicable to both Emirati and foreign employees. |
Payment of Wages
Wages shall be paid at least once a month, and can be paid on a monthly, weekly, daily, hourly or piecework basis.
All employers registered with Ministry of Human Resources and Emiratisation (MoHRE) must subscribe to the 'Wages Protection System (WPS)' and pay wages to their employees through it, as per the relevant due dates.
Minimum Wage
There is no statutory minimum wage set in the UAE.
Statutory Bonus
There is no statutory bonus in the UAE.
Termination
An employment relationship may be terminated by the mutual agreement of both the employer and employee or by the unilateral decision of either party, provided that a written notice of their intention to terminate is produced.
The approval of the Ministry of Human Resources & Emiratisation is necessary for the dismissal of a UAE national. Employers shall conduct an exit interview with the employee and submit details of the interview to the Ministry.
Notice Period
A notice period can be agreed upon in the employment agreement, provided that they are at least 30 days and at most 90 days. The party who violates the notice period provision of the Law shall pay the other party a "notice period allowance" amounting to the employee's wage for the notice period not observed.
If the termination is initiated by the employer, the employee is entitled to take an unpaid day off per week during the notice period to look for another job. Employees shall notify their employer of the day of absence at least 3 days in advance.
In any case, employment relationship may be terminated without notice or any payment in lieu if there is sufficient justification for summary termination.
| Cases justifying dismissal without notice | Cases justifying resignation without notice |
|---|---|
| Employee impersonated another person, or submitted forged documents | Employer failed to meet their contractual or legal obligations towards the employee, provided that the employee have notified the MoHRE 14 working days before the date of quitting and the employer has failed to rectify the breach despite being notified by MoHRE of the same |
| Employee committed a mistake that resulted in gross physical losses to the employer or they deliberately damaged the employer's properties, provided that the employer inform the Ministry within 7 days of being aware of such incident | |
| Employee violated the company's regulations regarding workplace safety, provided that the regulations are written and hung in a visible place, and with the employee being made aware of such regulations | Employer instructed the employee to perform a work fundamentally different from the work agreed upon in the employment contract without the employee's written consent on the same, except for situations where work is absolutely required |
| Employee failed to perform their basic duties according to their contract, provided that this is a repeated offence with warnings given at least twice | |
| Employee disclosed a work secret related to industrial or intellectual property which resulted in a loss for the employer, missed opportunity or achieving a personal benefit for the employee | Employer failed to remove the factors that pose a grave danger and/or threaten the workers' safety or health despite being aware of it |
| Employee found drunk during working hours, under the influence of narcotics or psychotropic substances, or doing any action breaching the public morals at the workplace | |
| Employee assaulted their co-workers at work by word, action or any other form that is punishable by the Law | Employer assaulted or harassed the employee at the workplace, provided that the latter has informed the competent authorities and the MoHRE within 5 working days from the date on which they were able to report |
| Employee had been absent without legitimate reason or acceptable excuse for more than 20 intermittent days in a year or more than 7 consecutive days | |
| Employee abused their position for personal gains | |
| Employee worked for another employer without abiding by any rules stipulated by the Law or their employment agreements |
Note: For summary dismissal of employment, a proper investigation shall be conducted, its findings be produced in writing and presented to the employee.
Severance Pay
Full-time foreign employees with at least a year of service shall be entitled to the following end-of-service benefits:
| Length of service | Severance pay | Note |
|---|---|---|
| Up to 5 years | 21 days' basic wage for each year of service | - |
| Over 5 years | 30 days' basic wage for each year of service in excess of the first 5 years | Total severance shall not exceed the wages for 2 years of service |
Upon the termination of an employment contract, employers are generally obligated to cover the repatriation expenses of their employees to their place of recruitment or any other places agreed upon unless the termination was attributed to the employee or if the employee has been employed by another employer.
Note: UAE or GCC nationals shall be enrolled in a pensions and social securities scheme that exempts employers from paying the above severance pay.
Probationary Period
The probation period of the employee must not exceed 6 months or be extended for another term.
Probationary employees are not entitled to any paid sick leave, with unpaid sick leave being granted only when it is advised by a medical certificate.
In any case, employers may agree to grant probationary employees leave from their annual leave balance, with the employee retaining their right to be compensated for the remainder of their annual leave balance in case they do not pass the probationary period.
When terminating an employment relationship during the employee's probationary period, the following shall be observed:
| Notice period | Note | |
|---|---|---|
| Employer seeking to terminate | Written notice of termination at least 14 days before termination date. | - |
| Employee seeking to terminate to work for another employer in the UAE | Written notice of termination at least a month before termination date. | The new employer shall compensate the current employer for the cost of recruitment, unless otherwise agreed upon. |
| Foreign employee seeking to terminate to move out of the UAE | Written notice of termination at least 14 days before termination date. | If the employee wishes to return to the State and obtain a new work permit within 3 months from the departure date, the new employer shall pay compensation to the previous employer. |
Work Time Rules
Standard Working Hours
Standard working hours are subject to a maximum of 8 hours per day or 48 hours per week. An employee's regular working hours shall be reduced by 2 hours per day during the holy month of Ramadhan.
Break Period
Employees cannot work for more than 5 consecutive hours without break. The break period is subject to a minimum of an hour, to be taken separately or at once, and it shall not be counted into an employee's working hours.
Furthermore, female employees are entitled to up to 2 breastfeeding breaks per day, provided that the total time taken does not exceed an hour. This break is valid for up to 6 months after the employee returns from their maternity leave.
Overtime
Overtime work is subject to a maximum of 2 hours per day, with further extension to overtime hours being allowed if the work is necessary to prevent the occurrence of a serious loss or a serious accident, or to eliminate or mitigate the effects thereof. In any case, total working hours shall not exceed 144 hours every 3 weeks.
Employees required to work overtime shall be paid as follows:
| Overtime pay | Notes | |
|---|---|---|
| Overtime | 125% of basic wage | - |
| Overtime between 10:00 p.m. and 4:00 a.m. | 150% of basic wage | Does not apply to shift workers already working night shift. |
Weekly Rest Days
Employees shall be granted a paid weekend of at least a day per week, which shall be determined according to the employment contract or the work regulation.
Employees required to work on their rest days shall be compensated with either a compensatory time off or 150% of their basic wage.
Holiday and Leave Entitlements
Public Holidays
Employees are entitled to days off with full pay on public holidays. There are 14 days of public holidays in the UAE for 2025.
| Holiday | Date |
|---|---|
| New Year's Day | January 1 |
| Eid al-Fitr | March 29–April 1 |
| Arafat Day | June 5 |
| Eid al-Adha | June 6–8 |
| Islamic New Year | June 27 |
| Prophet Muhammad's Birthday | September 4 |
| Commemoration Day | December 1 |
| National Day | December 2–3 |
Employees required to work on public holidays shall be compensated with either a compensatory time off or 150% of their basic wage.
Annual Leave
Employees are entitled to the following paid annual leave:
| Length of service | Annual leave |
|---|---|
| More than 6 months, but less than a year | 2 days for each month of service |
| Every year thereafter | 30 days |
The exact dates of leave shall be determined by the employer according to the work requirements and in agreement with the employee. The employer shall then notify the employee of the specified date within at least a month of the date of leave.
The employee may, with the consent of the employer, carry over their annual leave balance to the next year.
Note: Employers shall not prevent their employees from benefiting from their accrued leave for more than 2 years unless the employee wishes to carry it forward or have it be paid in lieu.
Sick Leave
In the event that the employee falls ill due to a disease or injury not related to work, they must report to their employer about their illness with a medical certificate within 3 days. These employees shall then be entitled to a maximum of 90 days of sick leave, which can be taken either continuously or intermittently.
An employee's sick leave shall be paid as follows:
| Sick leave pay | |
|---|---|
| Day 1–15 | Full pay |
| Day 16–45 | Half pay |
| Day 46–90 | Unpaid |
Maternity Leave
Female employees who have been pregnant for 6 months are entitled to 60 days of maternity leave, which shall be paid as follows:
| Maternity pay | |
|---|---|
| Day 1–45 | Full pay |
| Day 46–60 | Half pay |
Maternity leave can be applied for by the employee up to 30 days prior to the expected date of delivery, and can be extended in the following cases:
| Reasons for extension | Extended maternity leave |
|---|---|
| Mother's or child's sickness due to pregnancy or childbirth | 45 days (continuous or intermittent), unpaid |
| Mother giving birth to a sick child or child of determination that requires constant companionship | 30 days, paid + 30 days, unpaid |
Note: Maternity leave shall also be applicable for cases of stillbirth or miscarriage.
Parental Leave
Employees who have a newly born child are entitled to 5 days of paid leave to take care of that child. This leave can be taken continuously or intermittently within 6 months from the date of childbirth.
Other Leave
| Leave | Paid/Unpaid | Duration | Note |
|---|---|---|---|
| Bereavement Leave | Paid | 3–5 days | Leave for the death of a spouse shall be 5 days, while the death of a parent, child, sibling, grandchild or grandparent shall be 3 days. |
| Hajj Leave | Unpaid | 30 days | Only granted once throughout the employee's entire service for the performance of Hajj. |
| Sabbatical Leave | Paid | - | For national employees to perform national service. |
| Study Leave | Paid | 10 days per year | For employees with at least 2 years of service to sit for exams, provided that they are enrolled or are regularly studying at one of the UAE's certified educational institutions. |
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