Out-Law / Your Daily Need-To-Know

Tomorrow’s world of agile working: United Arab Emirates

Out-Law Analysis | 05 Jan 2022 | 10:48 am | 1 min. read

UAE businesses should review whether they need to update employment contracts and policies given the growth in remote working arising from the Covid-19 pandemic.

Many UAE businesses adapted well to the workplace challenges of the pandemic. The shift to global remote working arrangements provided opportunities for both UAE-based employees, who were able to adopt flexible working patterns, and employers, who successfully reduced office lease costs and increased operational efficiencies during this period. All our UAE-based clients have adopted some form of agile working over the past two years and many of those clients intend to maintain some form of agile working within the UAE in future. The regional and global advantages to agile working include a boost to productivity levels, an increased collaboration with international colleagues, and a more versatile workforce.

However, there is widespread acknowledgment of the advantages of knowledge sharing and social interaction to be derived from workers being in the same physical space with colleagues. Each employer has to consider their own approach to remote working individually, with reference to their commercial objectives, organisation culture and structure and industry norms. There are further practical and legal issues to consider too.

Practical considerations in the UAE

There are a few practical aspects that all UAE employers should consider in the context of implementing a long term remote working arrangement:

  • Are there any notice requirements which must be observed or any other contractual considerations which clients should address when implementing a long-term change?
  • Which HR policies / sections of the company handbook will be affected by the change?
  • What is the method of consultation and communication of such changes? There are no strict statutory consultation obligations to comply with under the UAE Labour Law but it may be helpful to undertake a short form consultation procedure.
  • What is the reasonable level of support that the employer can provide to ensure that health and safety requirements are met in each employee’s remote workspace?
  • Will there be any restrictions on where and when employees work that should be set out? For example, does the work allow employees to work from public spaces? Are employees permitted to work from outside of the UAE?
  • How will the company ensure its confidential and business sensitive information and data security are protected?
  • What are the main local employment and immigration laws, payroll obligations, and tax-related aspects that will need to be considered?
  • Are there any supplementary insurance policies which must be considered?
  • Is an employee carrying out a regulated activity? If so, do the regulators in question permit this remote working arrangement?

This is a non-exhaustive list of issues that should be considered. Another significant element to factor in is the need to adapt and modernise employee performance evaluations, traditional goal settings, and reward frameworks to motivate employees in a remote context.

Overview of labour law issues relating to remote work

In the UAE, unless an employee is expressly permitted to work remotely by their employer, their rights to do so under the current legislative framework are limited. An employee’s work permit and the applicable labour laws do not extend to anything more than allowing the employee to work from the employer’s registered office address. Beyond any pandemic-related stipulations, there is no legal right for employees to insist on working remotely. As a result, UAE employers have discretion to determine whether and to what extent employees are permitted to work remotely or are otherwise required to work from the office.

Unless the employee is party to a part-time visa, employees are only permitted to work for the employer which is the visa sponsor from a regulatory perspective. It is therefore important that employers permitting employees to work remotely ensure that the employees do not work for other companies or work from other companies’ offices.

Notwithstanding that employment laws in the UAE are being updated, with a new legal framework being applicable with effect from February 2022, the UAE Labour Law as it stands provides that an employee’s absence from the workplace without a valid cause for more than seven consecutive days or 20 non-consecutive days constitutes an act of gross misconduct, whereby an employer is permitted to dismiss the employee immediately and without prior notice.

The positive effects of the pandemic: an added level of flexibility to rigid government processes

Despite a return of some pre-Covid workplace norms, the pandemic inspired the UAE government to digitise some of its processes. Some transactions have become entirely electronic as a result. By way of example, the notarisation of legal documents and the attendance of court hearings is now facilitated remotely. The UAE has also relaxed its licensing requirements and allows the public to use videoconferencing platforms such as Zoom and Microsoft Teams, which the Telecommunications and Digital Government Regulatory Authority previously blocked.

Introduction of a virtual working program

Another positive post-Covid shift that was introduced by the UAE government is the issuance of remote work visas, which allows individuals who are not employed by entities licensed in the UAE, but by employers outside the UAE instead, to live in the UAE.

While the “virtual working program” is subject to certain conditions, including a minimum salary of USD $5,000 per month, the changes represent a great shift from the old immigration regime which required foreign employees to obtain a work permit and residency visa through an employer, which had to an entity established in the UAE, in order to legally work and reside in the UAE.

Steps UAE companies should adopt

Businesses should consider whether and to what extent their workforce are required to work from the office or permitted to work remotely to maximise cost efficiencies and business operations.

Once the business has determined its preferred working arrangements, we recommend considering the practical and legal issues that will further influence their desired approach. It may be necessary to make amendments to HR paperwork to reflect the new working arrangements, including updating employment contracts, introducing remote working policies and amending any supplementary policies that may be affected by the remote working arrangements, such as performance metrics and IT and confidential information policies.

Co-written by Ayah Abdin of Pinsent Masons.