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Sun 2 Oct 2016 05:50 PM

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UAE's new wages protection scheme to start on Monday

Ministry of Human Resources and Emiratisation says decree will ensures employees’ full payment of their salaries on time

UAE's new wages protection scheme to start on Monday
Saqr bin Ghobash Saeed Ghobash, Minister of Human Resources and Emiratisation.

The UAE's Ministry of Human Resources and Emiratisation will start implementing a new wages protection decree on Monday, an official has said.

The decree, launched by Saqr bin Ghobash Saeed Ghobash, Minister of Human Resources and Emiratisation, ensures employees’ full payment of their salaries on time, news agency WAM said.

Maher Al Obed, Assistant Undersecretary for the Inspections Sector, said: "The decree fairly contributes towards labour market stability as it safeguards employees while keeping business owners interests, salaries paid on time is a major contribution towards labour rights protection which is highly recognised by the UAE.

"We value such decisions as it promotes labour relations which in turn secures a balanced labour market productivity, and eventually turns out with positive outcomes for both labourers and employers," he said.

The decree affects companies employing more 100 workers. Such companies must pay wages within a period not exceeding 10 days from the registered payday in the wages protection system (WPS). If they fail, the ministry will stop granting them any additional work permits starting from the 16th day of delay.

The decree states that if a company delays wages a month from the due date, the ministry shall inform the judicial authorities and other related parties to take all necessary punitive measures against the violating company. Additionally, the ministry can halt other companies owned by the same employer.

If a company continues to fail to pay wages, the ministry will take necessary measures to use the company’s bank guarantee, WAM added.

"If the company fails to pay wages for 60 days from the due date, then administrative fines shall follow, in addition to registered fines for failing to pay wages a month from the due date, as stated above in the first scenario," Al-Obed added.

Administrative fines reach AED5,000 per worker’s delayed wage pay, stretching to a maximum of AED50,000 in events which include multiple workers protesting about deferred wages past 60 days.

Dr John S Maxwell 3 years ago

Congratulations on leading the way on this issue. Certainty and balance in the employer/employee relationship has a direct impact on employee satisfaction and commitment. Well done UAE

Abu Holoush 3 years ago

This is a very good initiative but how are companies who work with the government sector protected? For example, if I am a contractor and my employer is a government entity, and that entity decided not to pay me on time, how am i expected to make a timely payment to my workers?