The United Arab Emirates has serious concerns about workers' rights and has implemented and made regulations too strict for the relationship between employers and employees. The regulations wanted companies to operate within the legal framework. With the penalties ranging from Dh 100,000 to Dh 1 million, the government is sending a clear message that no violations of labor law will be tolerated.
This article will explore the key aspects of the new law, the penalties, and what this means for both employers and employees in the UAE.
Overview of the New Law
This new UAE labor law for employers puts serious concerns into a wide range of issues, from hiring practices to company closures. The UAE gov has broadened their efforts with this law to regulate the way employers treat their workers and create a proper and peaceful working environment for everyone. It also aligns with the country's vision of being a global leader in business and human rights.
The violations of this law include employing workers without the proper permits, failing to deliver employees' rights, not following the rules when a company closes, and engaging in fraudulent practices like fake Emiratization. The law considers all the common issues in the labor market and penalties will be severe based on the violations.
Violations and Penalties
Hiring Workers Without Work Permit
The UAE government considers hiring workers without a valid work permit to be one of the most serious offenses. The practice of illegal hiring can lead to the exploitation of workers, and their rights cannot be protected. This is why the UAE gov has serious concerns about this matter and companies who violate this rule should face serious penalties from Dh 100,000 to Dh 1 million. This high penalty is to strictly prevent employers from illegal hiring practices.
Closing a Business Without Settling Workers' Rights
When a business closes, the employer must settle all outstanding rights and payments owed to their workers. This includes wages, end-of-service benefits, and any other financial commitments. The new UAE labor law makes it clear that failing to do so is a serious violation. Workers depend on their income to support themselves and their families, so leaving them without proper compensation can have devastating consequences. Employers who shut down their businesses without fulfilling these obligations will be fined heavily.
Fraudulent Labor Practices
Fraudulent labor practices are another major concern addressed by the new UAE labor law. This includes practices like fake Emiratization, where companies falsely claim that they have met the legal requirements for hiring Emirati nationals. The government of the UAE's goal of hiring its citizens in both the public and commercial sectors is known as "Emiratization". By faking these numbers, companies not only violate the law but also damage the goals of the Emiratization program. The law imposes strict penalties on employers who engage in such fraudulent activities, with fines that can go up to Dh 1 million.
Employing Minors in Violation of the Law
The employment of minors under 15 is another serious offense that the new law addresses to ensure their safety and well-being. Under several conditions and with juvenile work permits issued by MoHRE, those between the ages of 15 and 18 are allowed to work in the UAE (check here). Employing minors in violation of these laws is considered a serious offense, and employers who do so will face significant fines.
Legal Process for Dispute Resolution
In addition to the fines and penalties for violating labor laws, the new law also introduces changes to how disputes between employers and employees are handled. The law states that any disputes should be referred to the Court of First Instance, rather than the Court of Appeal, if there is a disagreement with a decision made by the Ministry of Human Resources and Emiratization (MOHRE). This applies to all cases except for those disputes that have been adjusted or reserved for the issuance of a judgment.
This change is significant because it streamlines the process for resolving labor disputes. The law aims to make the process quicker and more efficient. This is especially important for workers who may be facing financial difficulties while waiting for a resolution.
The Court of First Instance is considered the first level of the judiciary in the UAE, where cases are initially filed. With this, the government expects to reduce the backlog of cases in the higher courts. This change is expected to benefit both employers and employees by providing a faster and more accessible path to justice.
Implications for Employers
The new law has significant implications for employers in the UAE. It requires them to be more diligent in their hiring practices and in how they manage their workforce. Employers must ensure that they comply with all aspects of the labor law, including obtaining the necessary work permits for their employees and settling all outstanding payments when a business closes.
Employers who commit violations should face serious financial penalties, and it also brings damage to their business reputation. This could have long-term consequences for their business, including difficulties in attracting talent and securing contracts.
To avoid these risks, employers should have a serious check on their current employment practices and make any necessary changes to ensure compliance with the new law. Employers can also consult with legal experts to understand the complete details of this law and how to implement policies and procedures that align with the regulations.
Implications for Employees
For employees, this new law is to assure you additional protection, security, and a peaceful working environment anywhere in UAE. Your rights are being taken seriously and there are legal mechanisms in place to protect you from exploitation. The law also provides a clear path for resolving disputes, which can help employees feel more confident in asserting their rights.
One of the most significant benefits for employees is the assurance that they will receive the payments and benefits they are entitled to, even if their employer closes down the business. This is particularly important in a country like the UAE, where many workers are expatriates who rely on their income to support themselves and their families back home.
The law also sends a strong message to employers that fraudulent practices, such as fake Emiratization or hiring workers without proper permits, will not be tolerated. This helps create a more transparent and fair labor market, where employees can trust that they are being treated fairly and in accordance with the law.
Conclusion
The new UAE labor law represents a significant step toward building a more fair working environment. It shows the country's commitment to protecting human rights and maintaining a transparent and controlled labor market. The UAE government is taking serious action against illegal and unethical practices by imposing heavy fines on employers. It will be important for both employers and employees to stay updated about their rights and responsibilities to ensure a smooth and successful transition to the new legal framework.
