G-P’s Global Growth Platform™ makes it possible to start obtaining services in the UAE in minutes via our global entity infrastructure – allowing your company to expand your global footprint without the hassle of entity setup and management. G-P provides services in the UAE for its customers through the assistance of one or more professionals capable of meeting the demands expressed by the customer.
Our global employment products, including G-P Meridian Prime™ and G-P Meridian Core™, are backed by the largest team of HR and legal experts in the industry. We handle the growing complexities of global expansion and compliance for you — so you can focus on the global opportunities ahead.
You’ll have peace of mind knowing you have a team of dedicated experts to support your growth. G-P allows you to harness the talent of the brightest people in 180+ countries around the world, quickly and easily.
Hiring in the United Arab Emirates
The United Arab Emirates comprises 7 emirates. Most technology companies hiring sales employees in the UAE focus on the emirates of Abu Dhabi or Dubai. There are also approximately 45 free trade zones in the UAE, more than 30 of which are located in Dubai, each managed by its own free zone authority. Traditionally, companies in the UAE would establish an entity in Abu Dhabi, Dubai, or in one of the free zones, which would enable the company to sponsor or access work permits and thus hire employees. Working with G-P, customers can have access to talent in the UAE regardless of entity status.
A business license is required for any business operating in the UAE. Employees must be sponsored under the correct visa in the UAE, either by their employer if on the mainland or by the respective free trade zone authority if working for a company in the free zone. A company must have the appropriate business license(s) to obtain visas for its employees. If an employee is found to be living and working in the UAE without a visa, or if a company sponsoring an employee’s visa is not properly licensed, the employee may be asked to leave the country, and both the employee and the company may be blocked from doing business in the UAE.
The UAE Labor Law regulates employment on the mainland of the UAE. If employees are employed in a free zone, their employment is regulated by the employment law adopted by the free zone authority where the individual is employed, which may contain differences from the UAE Labor Law. Each free zone authority has its own employment law, and employees are subject to the rules and regulations of their respective free zone authorities.
Employment contracts in the UAE
A written contract is required to submit an application for visa sponsorship in the UAE. It is best practice for companies to put in place a strong, written contract in both Arabic and English that clearly states the terms of the employee’s compensation, benefits, place of work, job title, duration of the contract, and termination requirements. Any employment contract in the UAE should always state the salary and any compensation amounts in United Arab Emirates dirham (AED) rather than another currency.
Working hours in the UAE
In the UAE, the standard working week is Monday to Friday, with 40 working hours. Actual working hours may vary according to the needs and requirements of the job responsibilities. The maximum working hours in the UAE are 8 hours a day or 48 hours a week. The UAE federal government has adopted a 4.5-day working week. Hence, government sector employees work 8 hours, from 7:30 a.m. to 3:30 p.m. from Monday to Thursday, and from 7:30 a.m. to 12:00 p.m. on Fridays. Saturdays and Sundays are official weekend days.
Subject to prior approval being received, employees can claim overtime as per UAE labor law. If the circumstances require the employee to work on an off day, as specified in the labor contract or work regulations, the employee is entitled to a substitute rest day or pay equal to normal working hours’ remuneration plus 50% of that pay.
During Ramadan, local laws state that working hours must be reduced by 2 hours a day.
Holidays in the United Arab Emirates
An employee is entitled to an official holiday with the full wage for all holidays declared by the government for the public and private sectors.
Islamic holidays are timed according to local sightings of various phases of the moon and are subject to change.
The number of days of holiday is based on expected days off for the private sector. Private sector employees are entitled to full pay on official holidays, which are:
- New Year’s Day
- Eid Al Fitr
- Eid Al Adha
- Islamic New Year
- Prophet’s Birthday
- Commemoration Day
- UAE National Day
Vacation days in the UAE
Thirty calendar days of vacation is a market norm benefit in the UAE. Vacation leave is based on an employee’s length of service:
- Less than 6 months: The employee is not entitled to an annual vacation.
- Six to 12 months: The employee is entitled to an annual vacation of no less than 2 days each month.
- Over 1 year: The employee is entitled to 30 calendar days of vacation.
Vacation time that is not used may be carried forward and accrued or paid out in lieu. Unless advised otherwise by an employer, employees must utilize their annual leave in the applicable annual leave year.
Employees are entitled to a payment in lieu of unused leave upon the termination of employment calculated on the basis of an employee’s basic salary only.
UAE sick leave
After 3 months of continuous service following the probation period, an employee is entitled to up to 90 days of sick leave per year, paid as follows:
- The full wage for the first 15 days
- The half wage for the next 30 days
- The remaining 45 days are without pay
During the probationary period, the employee may get sick leave without pay, subject to the employer’s approval and based on a medical report issued by the medical entity that stipulates the necessity of the leave.
Parental leave in the UAE
Pregnant employees are entitled to 60 days of maternity leave — 45 days at full pay and 15 days at half pay.
If the infant is ill or disabled, employees may take an additional 60 days of leave — 30 days at full pay and 30 days unpaid. Employees must have a medical certificate from a medical authority proving the baby’s condition.
Employees may also take an additional 45 days of unpaid leave if they experience illness due to pregnancy and cannot work. Employees can take these days non-consecutively but need a report from a medical authority.
Both male and female employees are entitle to 5 paid days of parental leave at any time within 6 months of the child’s birth.
Health insurance in the United Arab Emirates
For expats, insurance coverage is mandatory for employees and discretionary for dependents, but the best practice is to cover dependents.
UAE supplementary benefits
The Hajj is an annual Islamic pilgrimage to Mecca, Saudi Arabia, that Muslims are expected to complete at least once in their lifetime. Under UAE Labor Law, employees may be granted a one-time pilgrimage leave of up to 30 days without pay.
Termination and severance in the UAE
Employment in the UAE can be subject to a probationary period of up to a maximum of 6 months. During the probationary period, an employer may terminate the employment without notice or reason.
An employer in the UAE generally can terminate an employment contract by providing notice of at least 30 calendar days and for a valid reason.
An employee who completes 1 year or more in continuous service is entitled to severance pay at the end of their service. If an employee is terminated, they are entitled to gratuity pay as follows:
- If service is less than 1 year, an End of Service Benefit is not applicable.
- If service is between 1 and 5 years, the End of Service Benefit is calculated as 21 days’ base salary for each year of service.
- If service is more than 5 years, the End of Service Benefit is calculated as 21 days’ base salary for each of the first 5 years plus 30 days’ basic salary for the rest of the years.
Paying taxes in the United Arab Emirates
There are no employer taxes in the UAE. However, we recommend setting aside 8.3% of the employee’s compensation for the End of Service Benefit.
Why G-P?
At G-P, we help companies unlock the power of the everywhere workforce through our industry-leading Global Growth Platform™. Let us handle the complex and costly tasks involved in finding, hiring, onboarding, and paying your team members, anywhere in the world, with the speed and guaranteed global compliance your business needs.
Contact us today to learn more.