Welcome to our FAQ guide on the recent changes in labour regulations in the UAE, effective from the first Monday of January 2024. These updates signify a significant shift in the employment landscape, emphasizing fairness, transparency, and adherence to global standards. As the UAE continues to evolve as a global economic hub, staying abreast of the latest legal developments is crucial for both employers and employees. In this guide, we’ll address common questions and concerns regarding these changes.
FAQ:
Q1: What are the major amendments introduced by the Ministry of Human Resources and Emiratisation (MoHRE) in 2024?
Answer:
The MoHRE has implemented crucial changes to Federal Law No. 20 of 2023 on labor relations. These amendments prioritize the rights of all parties involved in contractual labour relations, with a particular focus on fairness, transparency, honesty, and neutrality
Q2: What disputes fall under the authority of the Ministry for conclusive resolution?
Answer:
The Ministry now holds the authority for conclusive resolution of disputes related to contractual labour relationships in private sector establishments, specifically when the disputed amount is AED 50,000 or less (approximately USD 13,600).
Q3: How is the dispute resolution process streamlined under the new regulations?
Answer:
The Ministry’s decisions on labour disputes are both executive and final, providing a more efficient mechanism for resolving disputes promptly. This aims to foster a legislative environment characterized by fairness and expedited conflict resolution.
Q4: What is the significance of the changes in employment disputes for amounts less than AED 50,000?
Answer:
Effective January 1, 2024, MOHRE will act as a judge for employment disputes valued at less than AED 50,000, settling them with a final decision. MOHRE’s decision has the power of a writ of execution, similar to a first-instance court judgment.
Q5: Are there any implications for legal representation during the dispute resolution process?
Answer:
As of now, it is unclear whether legal representation will be permissible for claims before MOHRE. Parties involved in disputes should stay updated on any developments in this regard.
Q6: How does the new anti-discrimination law impact employment practices?
Answer:
Federal Decree-Law No. 34/2023 prohibits discrimination, hatred, and extremism. Employers should be cautious when terminating or dealing with employee issues, as any act that incites defamation or disrespect of protected religions may lead to criminal penalties.
Q7: What are the Emiratisation targets introduced for private sector companies?
Answer:
The Emirati Human Resources Competitiveness Council (Nafis) aims to integrate 75,000 Emiratis into the private sector within the next five years. Smaller companies (20-49 workers) are required to employ at least one UAE citizen from 2024, increasing to two Emiratis from 2025. Larger companies (50 or more employees) face a 2% annual Emiratisation rate target with an overall increase of 10% by 2026.
Q8: What are the enforcement measures for Emiratisation targets, and what penalties apply for non-compliance?
Answer:
Non-compliant companies will face a monthly payment of AED 6,000 for each unemployed citizen from January 2023. This contribution increases annually by AED 1,000 until 2026. Non-compliance for smaller companies (20-49 workers) leads to a financial contribution of AED 96,000 in 2024 and AED 108,000 in 2025.
Q9: How can companies benefit from the Nafis platform for Emiratisation support?
Answer:
Companies should register on the Nafis platform to benefit from the program’s support in supplying the private sector with qualified Emirati professionals. This includes advantages in attracting local expertise and complying with Emiratisation requirements.
Q10: What is the deadline for updating existing employment contracts to comply with the new UAE Labour Law (Federal Decree-Law No. 33/2021)?
Answer:
The deadline for updating existing contracts was extended to December 31, 2023. There is no indication of further extensions, emphasizing the importance of ensuring compliance with the updated legal requirements.
Q11: What are the specific obligations for employers participating in the investment scheme for end-of-service gratuities?
Answer:
Employers choosing to invest in licensed investment funds for employees’ end-of-service gratuities must fulfill various obligations. This includes careful selection of licensed investment funds and providing necessary documents and information to both the fund and in-scope employees.
Q12: How does the new anti-discrimination law affect employment termination and employee issues?
Answer:
The Federal Decree-Law No. 34/2023 on Combating Discrimination, Hatred, and Extremism introduces strict prohibitions on contempt of religions, discrimination, and hate speech. Employers should exercise caution during termination and employee-related matters to avoid potential legal consequences under this law.
Q13: Are the Emiratisation targets applicable to specific industries, including construction?
Answer:
Yes, the Emiratisation targets, enforced by the Emirati Human Resources Competitiveness Council (Nafis), apply to 14 sectors, including construction. Companies in these sectors must comply with the specified Emiratisation rates and contribute to the integration of Emiratis into their workforce.
Q14: How can companies excel in Emiratisation and avoid penalties for non-compliance?
Answer:
Companies can excel in Emiratisation by actively participating in training and employing citizens. Incentives are granted to institutions excelling in this regard. Non-compliance penalties, such as monthly payments for each unemployed citizen and financial contributions, can be avoided by meeting the stipulated Emiratisation targets.
Q15: Can companies still update existing employment contracts after the extended deadline of December 31, 2023?
Answer:
While there haven’t been indications of further extensions, it’s essential to check for any updates. Companies should prioritize updating existing employment contracts to align with the new UAE Labour Law (Federal Decree-Law No. 33/2021) to avoid potential legal complications.
Q16: How can individuals appeal MOHRE’s decision in employment disputes valued at less than AED 50,000?
Answer:
If dissatisfied with MOHRE’s decision in employment disputes valued at less than AED 50,000, a party can file an appeal with the Labour Court of Appeal within 15 working days from the date of notification of the decision. Any judgment issued by the Labour Court of Appeal will be final.
Q17: Are the new labour regulations applicable to companies in free zones like the DIFC and ADGM?
Answer:
The applicability of the new labour regulations may vary in free zones, as they often have their own dispute-resolution mechanisms. However, companies should stay informed about any specific regulations in their respective free zones and comply with both federal and free zone laws. Understanding the intricacies of the recent labour regulations in the UAE is vital for individuals and businesses alike. Regular updates and compliance are essential to navigating these changes successfully. For specific legal advice tailored to your situation, consider contacting Dubai lawyers or legal consultants who can provide personalized assistance.