UAE labour law modernisation efforts continue into 2019

Out-Law Analysis | 26 Feb 2019 | 2:24 pm | 3 min. read

ANALYSIS: After a busy 12 months in the development of labour laws in the United Arab Emirates (UAE), the authorities look set to continue to focus on modernisation efforts in 2019.

The UAE Labour Law of 1980 remains the underlying legislation governing employment relationships in the UAE private sector. However, the UAE economy and workplace is much more sophisticated and diverse than it was when this law was originally implemented. The series of regulations and decrees that have been introduced to supplement that law are therefore extremely important to enable UAE-based companies to continue to attract, appropriately manage and retain leading talent from around the world.

The more notable initiatives expected in 2019 include:

New DIFC employment law

The Dubai International Financial Centre (DIFC) Authority held a public consultation on its draft new DIFC Employment Law in February and March last year. The final version of the new law is expected to be introduced in the first half of 2019. We understand that the law will be supplemented by additional regulations.

Gender equality and multiculturalism

This year has been declared by the UAE authorities as the 'Year of Tolerance', with a particular focus on establishing the UAE as a global reference point for cultural and religious tolerance.

UAE vice president and ruler of Dubai Sheikh Mohammed bin Rashid has formed a Supreme National Committee for Tolerance to work on the 'seven pillars' of the initiative. These include developing policy, legislation and executive regulations to guarantee sustained values of tolerance in the UAE.

A new law on multiculturalism has been proposed, which is expected to complement and build on the Anti-Hate Law legislation that was introduced in the UAE in 2015. The Anti-Hate Law penalises discrimination against anyone on the basis of various characteristics including religion, gender and creed.

One of the focus areas of the UAE leadership is gender equality, and there have been developments over the past few years to support women in the workplace. Examples of this are the new part-time working law described below; and enhanced maternity leave for public sector workers in 2017, which increased maternity leave from 45 calendar days to three months.

We anticipate that the UAE authorities will continue to consult on legislation to support women in the workplace in the short to medium term future. Areas that we understand the authorities are considering are the introduction of statutory recognition for flexible working, enhanced maternity leave for the private sector and laws developing the existing equal pay legislation.

Here are some of the biggest developments from 2018 that you may have missed.

Part-time working resolution

The Ministry of Human Resources and Emeritisation (MOHRE) introduced a resolution on part-time working and an associated part-time working visa in 2018. This was one of the most significant developments of 2018. It allows for employees to officially undertake part-time working, and to work for more than one employer at the same time.

The part-time working visa is only available in the onshore mainland area at the moment.

'Good conduct' certificates

A requirement that employees provide a 'good conduct' certificate or police clearance certificate when applying for a new employment visa in the UAE was introduced, and subsequently suspended, in 2018. The system was suspended with effect from 1 April 2018. The authorities have not indicated whether, and if so to what extent, the requirement will be reintroduced in 2019.

Equal opportunities for disabled employees

A decree introducing equal opportunities for disabled employees came into effect in August 2018. This decree aims to provide disabled employees with a legal right to be treated in the same way as other employees.

UAE employers should be mindful of their recruitment policies and working conditions to ensure that these do not present a barrier to disabled people against joining or continuing their employment with the company. This has built upon the existing legal framework which contained similar provisions, although previously these were only applicable to UAE nationals.

We anticipate that the authorities will continue to review and enhance the legislation relating to anti-discrimination and equality over the next few years.

New employee insurance scheme

A new low-cost employee insurance scheme was introduced towards the end of 2018, replacing a previous scheme which required companies to pay a bank guarantee deposit of AED 3,000 (approx. $816) per employee when applying for a work permit.

Insurance policies will cost AED 60 annually per employee, and will be set up "electronically and instantaneously" when a new work permit is applied for. The policies provide coverage of up to AED 20,000 per private sector employee or domestic worker against unpaid wages and benefits, return airfare to the employee's home country and court-ordered compensation for workplace injuries.

Data protection

The General Data Protection Regulation (GDPR) came into force in Europe in 2018, reforming the rules around data protection and replacing the previous directives. These changes provide standardised data protection laws across the EU.

The GDPR has implications for international businesses in the UAE which have a presence in an EU country if data is transferred or processed within the remit of the GDPR.

Luke Tapp and Andrea Hewitt-Sims are employment law experts at Pinsent Masons, the law firm behind