UAE: Companies that don't pay wages on time to face suspension on new work permits

Dr. Abdulrahman Abdulmannan Al Awar, Minister of Human Resources and Emiratisation, has issued Ministerial Resolution No. 346 of 2022 regarding the amendment of certain provisions of Ministerial Resolution No. 43 of 2022 on the Wages Protection System (WPS).

Under the new resolution, the Ministry of Human Resources and Emiratisation (MoHRE) will implement a series of administrative procedures against establishments that do not follow the provisions of the WPS, depending on the duration of the delay in paying workers’ salaries, the size of the establishment and the number of employees that have not been paid.

The resolution also stipulates that MoHRE will monitor establishments registered in its database, regardless of its size, through field visits and the electronic monitoring and inspection system to ensure it pays its employees on time.

The Ministry will also issue reminders and notifications to non-compliant establishments, and in the case no action is taken following the receipt of notifications, issuance of new work permits for such establishments will be suspended.

Khalil Al Khoori, Acting Under-Secretary for Human Resources Affairs at MoHRE, said,

"The issuance of the Ministerial Resolution is part of the ministry’s efforts towards developing the legislative structure regulating the UAE labour market, which leads global competitiveness reports due to its efficiency, flexibility, and achieving an attractive environment for employers and for talented workers. This is especially true because it ensures the rights and obligations of both parties to the contractual relationship in a balanced manner."

He noted the resolution aims to enhance long-term balance and stability of the relationship between employers and employees, in line with the rights and responsibilities outlined in the contracts between both parties.

"Primarily, it focuses on compliance with the wages’ deadlines and amounts agreed upon in those contracts,"

he explained.

Al Khoori commended compliant establishments, saying,

"This is testament to the awareness of the significance of complying with the labour law and its executive regulations."

The amendments outlined in the new resolution include procedures that will be taken gradually against establishments that employ 50 persons or more, where the relevant Public Prosecution will be notified, and the establishment information will be sent to the relevant local and federal authorities for further legal actions. The establishment will be followed up with by the respective department in the Ministry.

All non-compliant establishments, regardless of size, that fail to pay wages four months after the due date will face a suspension on new work permits.

If the owner operates other establishments listed with the WPS in the UAE, similar penalties will apply to each of them, after notifying the affected establishments about the suspension of work permits, considering the unity of the partners.

If the establishment repeats the same violation within six months, an administrative fine will be imposed as per Cabinet Resolution No. 21 of 2022, and the establishment will be downgraded to Tier three (3) under the MoHRE’s establishments classification system.

The amendments also allow establishments to submit requests for exemption from transferring their wages through the WPS in two new cases – seamen/sailors working on board vessels/ships, and workers of foreign establishments or their subsidiaries operating in the country who receive their wages from outside the country, subject to the workers’ consent.

These cases are in addition to the previously exempted cases, which are fishing boats owned by UAE nationals, public taxis owned by UAE nationals, banks and places of worship.

For more information and details about the ministerial resolution, employers may visit the Laws and Regulations page on the Ministry’s website via the following link: https://www.mohre.gov.ae./

News Source: Emirates News Agency