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When you hire in Dubai, you don’t just “add staff” —you have legal obligations under the UAE Labour Law for the private sector. So, if you are a start-up or trading company and service business manager, ensure that HR policies comply with Federal Decree Law No (33) of 2021 and its implementing regulations implemented by MOHRE.

This guide explains the rules in plain English, and it also shows how smart compliance reduces disputes, fines, and employee churn.

1) Who enforces labour rules in Dubai?

For the majority of mainland and MOHRE registered private sector companies, primary authority is with MOHRE (Ministry of Human Resources & Emiratisation). It grants work permits, regulates contracts and manages labour complaints.

However, keep in mind: some free zones may apply their own employment regulations. So, always confirm which framework your license uses before you copy-paste a template. Get details on Business Setup in Dubai.

2) Employment contracts: what businesses must get right

In the UAE, you should document employment properly from day one. The law requires an employment contract, and MOHRE sets recognised formats and requirements.

Contract essentials you should define clearly

• Job title + actual duties (avoid vague roles)
• Work location(s) and mobility expectations
• Salary structure (basic vs allowances)
• Working hours / shift pattern
• Leave entitlements
• Notice period and termination terms
• Confidentiality and (where valid) non-compete wording

Also, keep your “offer letter” and your actual contract consistent. Many disputes start because the documents don’t match.

3) Probation period rules (common mistakes businesses make)

Probation helps you assess fit, but UAE law puts boundaries around it. The probation period can’t exceed six months. Also, if the employer ends employment during probation, the employer must give at least 14 days’ written notice.

Because probation disputes rise fast, do this instead:

• Document performance issues early (emails + review notes)
• Use clear KPIs and measurable targets
• Keep a written warning trail (simple is fine)

4) Working hours, Ramadan hours, and overtime basics

Most private sector works are guided by the general rule: 8 hours a day or 48 hours a week. For Ramadan, the UAE shortens its working hours by 2 hours a day for employees.

Practical compliance tips

• Use attendance tracking (biometric or app-based)
• Put overtime approval in writing (even WhatsApp approvals help)
• Keep payroll records tidy because inspectors can ask

Overtime regulations and exemptions can get highly specific based on jobs and industries, so it’s best to put your overtime policy in writing and follow it uniformly. Looking for a Company Registration in Dubai?

5) Wages + the Wages Protection System (WPS): non-negotiable

Majority of the MOHRE registered employers are required to pay the remuneration via Wages Protection System (WPS). You delay salaries, skip WPS process and incur penalties and work-permit issues.

What businesses should do from month one

• Run payroll on fixed dates (don’t “float it”)
• Reconcile leave, overtime, and deductions before payroll cut-off
• Retain signed pay slips or electronic verifications

If cashflow fluctuates, plan ahead. In practice, late salary payments create the fastest employee complaints.

6) Leave and holidays: set expectations early

There is usually an expectation from employees about annual leave, sick leave, maternity/paternity obligations and public holidays. Even if your policy is permissive, put it in writing. Plus, apply it consistently across teams — inconsistent approvals lead to disagreements.

A strong business move: add a simple leave workflow (request → approval → payroll update). It saves you admin time and reduces end-of-service confusion later.

7) End-of-service benefits (gratuity): budget it correctly

When an employee has served and terminates with eligible leaving circumstances, the employer may owe Gratuities / End of Service Gratuity/ EOSB. The official UAE government webpage breaks down gratuity and how employers are expected to handle it, including for various work patterns.

What businesses should do (so you don’t get surprised)

• Track service start dates accurately
• Store basic salary history (because gratuity often ties to it)
• Document unpaid leave, absences, and final settlement items

Also, don’t wait until the last day. When you compute EOSB early, you can settle smoothly and protect your employer brand. Get details on Document Attestation Service in Dubai.

8) Termination and notice periods: reduce risk, increase fairness

Termination becomes messy when employers act emotionally or skip documentation. Instead:

• Use written warnings for repeated issues
• Keep investigation notes for misconduct cases
• Follow contract notice requirements and keep proof of delivery

Even when you “know you are right,” the paperwork decides outcomes.

9) Non-compete clauses: use them carefully 

Many Dubai businesses add a non-compete clause automatically. However, a strong clause needs a real business reason and reasonable limits. Overly broad non-competes can fail in practice, and they can even damage trust during hiring.

Best practice:

• Limit the clause to what you actually need (role, clients, geography, time)
• Add confidentiality + non-solicitation language (often more enforceable in reality)

10) Labour disputes: what happens if an employee files a complaint?

If a dispute happens, MOHRE typically reviews the complaint and aims for amicable settlement. If settlement fails, MOHRE can refer the matter to court.

So, before things reach that stage, do this:

• Respond quickly and professionally
• Keep payroll, contract, and attendance records ready
• Try mediation early (it often saves weeks of stress)

Related Articles:

» Steps to Launching Your Business in Dubai’s Dynamic Market

» Legal Procedures & Documentation: Navigating Business Setup Requirements in Dubai

» Choosing the Right Business Structure for Incorporation in Dubai

» Dubai Business Registration – 100% Ownership & Tax-Free

» Starting a Business in Dubai as a Foreigner

UAE labour law compliance checklist

Area	What to implement	Business benefit
Employment contracts	MOHRE-compliant contracts, consistent offer terms	Fewer disputes, clearer expectations
Payroll + WPS	WPS salary processing, fixed pay dates, records	Avoid penalties, build trust
Attendance + overtime	Tracking + written approvals	Clean audits, fair pay
Leave policy	Written policy + workflow	Less confusion, smoother operations
Exit & EOSB	Final settlement checklist + EOSB budgeting	Faster exits, lower legal risk
Dispute readiness	Document trail + HR SOPs	Strong defence if complaints arise

Business Compliance: UAE Labor Law Overview

UAE labour compliance isn’t just “legal stuff.” It’s a growth tool. When you handle contracts, payroll, working hours, and exits properly, you reduce turnover, protect your license reputation, and scale faster.

FAQs on “Understanding the UAE’s Labor Laws for Business”