UAE doubles down on penalties for late payment of wages

Amended resolution includes a new strict inspection system

The Ministry of Human Resources and Emiratisation has amended a number of rules under the Wage Protection System that is in place to protect workers’ salaries. Photo: Antonie Robertson / The National

The Ministry of Human Resources and Emiratisation has amended a number of rules under the Wage Protection System that safeguards workers’ salaries in the UAE.

Under the new resolution, the ministry will issue fines for delays in paying workers’ salaries based on the length of time, the size of the establishment and the number of employees that have not been paid.

The new resolution includes a new strict inspection system whereby establishments registered in its database, regardless of size, will be monitored through field visits and an electronic system.

In addition, reminders and notifications will be issued to non-compliant companies. When an employer fails to take action, the issuance of new work permits will be suspended until all wage disputes have been dealt with.

Other amendments outlined in the new resolution include procedures that will be taken gradually against establishments that employ 50 people or more.

All companies and businesses registered with the ministry must sign up with the Wage Protection System and those that fail to do so will be blocked from issuing any new work permits until salaries are fully paid.

Khalil Al Khoori, acting undersecretary for human resources affairs at the ministry, said the issuance of the resolution is part of the country's efforts towards developing the legislative structure of its labour market.

“Primarily, it focuses on compliance with the wages deadlines and amounts agreed upon in those contracts,” he said.

If found to be in breach of the Wage Protection System, the Public Prosecution will be notified and information related to the establishment will be sent to the relevant local and federal authorities for further legal action. The establishment will be followed up with by the respective department in the ministry.

Per the amendments, two new classes of worker are exempt from the Wage Protection System: sailors working on board ships and people employed in foreign establishments or their branches operating in the country.

The Wage Protection System aims to improve the relationship between employer and employee, and make clear the rights and responsibilities outlined in the contracts between both parties.