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Tue 26 Jul 2016 01:32 PM

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UAE issues decree to clamp down on salary payment delays

Ministry of Human Resources and Emiratisation says to get tougher with employers who fail to pay staff on time

UAE issues decree to clamp down on salary payment delays
Saqr bin Ghobash Saeed Ghobash, Minister of Human Resources and Emiratisation.

The UAE has issued a new decree to ensure employees’ wages are fully paid within a period not exceeding 10 days from the due date as registered in the wage protection system (WPS).

According to news agency WAM, the Ministry of Human Resources and Emiratisation said the decree will come into force in October and will cover all companies employing more than 100 staff.

Saqr bin Ghobash Saeed Ghobash, Minister of Human Resources and Emiratisation, said that companies which fail will not be granted any additional work permits starting from the 16th day from the date of delay.

The decree states that if a company delays wages by one month from the due date, which means the company has entered into the refrainment phase, the ministry shall inform the judicial authorities and other related parties to take all necessary punitive measures against it, prohibiting the employer from registering any new companies.

If a company continues to fail to pay wages, the ministry will take necessary measures to enable the workers to move to another company.

"If the company fails to pay wages for 60 days from the due date, then administrative fines shall follow, not forgetting the punishments that had been already meted out for failing to pay wages a month from the due date," Ghobash added.

Administrative fines will be AED5,000 per worker’s delayed wage, up to a maximum of AED50,000 dirhams in cases that include multiple workers complaining about delayed wages for over 60 days.

He said the ministry will lift the ban from violating companies granting them the ability to apply for new work permits if they immediately pay delayed wages during the first delay month.

The Decree reiterates that if a company frequently refrains salaries, the ban duration will double, after paying the wages.

worried UAE Business owner 3 years ago

The Ministry of Human Resources and Emiratisation should please also issue a decree that all governmental entities have to pay their contractors on time, to allow the companies to pay their workers!