The UAE has introduced a unified salary payment deadline for all private sector staff, mandating that wages must be paid by the first day of every month starting from June 1.
Under rules designed to strengthen wage protection and improve timely salary payments, employers must transfer wages for the previous month no later than the first day of the next month on the Gregorian calendar, the Ministry of Human Resources and Emiratisation said in a resolution issued on May 12. Any payment made after that date will be considered delayed, the resolution said.
The move follows a ministerial resolution this month aimed at boosting compliance and ensuring timely salary payments across the private sector.
The resolution also reinforces the use of the Wage Protection System (WPS), which requires all registered establishments to process salary payments through the system or any alternative channels approved by the ministry. Companies must also submit proof of payment in line with its compliance mechanisms.
“All establishments registered with the ministry shall pay the wages of their workers on the due date specified in through the Wage Protection System approved by the ministry … all establishments shall submit documents and data to prove the payment of their workers’ wages, in accordance with the rules and mechanisms set by the ministry,” the resolution said.
The WPS was launched in 2009 by the ministry and the UAE Central Bank to ensure private sector employees are paid wages accurately and on time. The latest resolution further strengthens oversight through the system.
It said employers would be deemed compliant if they paid at least 85 per cent of total wages due by the deadline. Similarly, employees will be considered to have received their wages if they are paid a minimum of 85 per cent of their entitled salary, provided any deductions are legally permitted under the UAE labour law.
The latest regulation also specifies categories exempt from the WPS. These include staff involved in wage disputes under court review, people reported as having absconded, employees on unpaid leave and those unable to work owing to legal restrictions.
Others such as seafarers, foreign employees paid outside the UAE, short-term mission workers and entities including banks, places of worship and some individually owned operations are also excluded.
What if you miss deadline?
If salary payments are delayed, the resolution enforces phased penalties immediately after the due date.
From day one, the ministry will monitor all companies electronically to ensure compliance, the ministry said. And if wages remain unpaid by the second day, the ministry will start issuing alerts and notifications to non-compliant companies.
By the fifth day if the salaries remain unpaid, the ministry will suspend the issuance of new work permits for the company. On the 11th day, repeat offenders within a six-month period will face administrative fines and be downgraded to the ministry’s “third category” – a lower business classification.
On the 16th day, penalties will increase severely, whereby labour disputes will be automatically registered for affected workers – either individually or collectively. Work permit issuance is also suspended for the concerned company, particularly those employing 25 or more workers across sectors in line with ministry regulations.
Toughest measures are enforced by the 21st day, if the salaries are still unpaid. That is when the ministry is likely to issue executive orders for salary payments, initiate precautionary asset seizure procedures and impose travel bans on company managers.
Companies employing 50 or more workers, or firms repeatedly breaking the rules, may also be referred to prosecutors, especially if authorities believe the violations could threaten labour market stability, according to the ministry resolution.
