The government has just implemented a new law to make sure more UAE workers are paid on time, here’s how it will work…

Do you work for a company that often pays your wages late? Well the UAE government has stepped in with a ruling that will penalise companies that don’t pay employees on time.

The new decree from the Ministry of Human Resources and Emiratisation came into effect on October 3, and it currently focuses on companies employing more than 100 workers.

If employee wages are paid more than 10 days after their due date the government will stop granting the company additional work permits starting from the 16th day of delay.

WHAT IF YOUR EMPLOYER SKIPS A WAGE?

Also, if a company hasn’t paid their employees for over a month after payment is due, so effectively skipping a wage, the government will step the penalties up a notch. “The ministry shall inform the judicial authorities and other related parties to take all necessary punitive measures against it, causing a complete strike against the other companies owned by the same employer, plus prohibiting the employer the ability of registering any new companies,” said Minister of Human Resources and Emiratisation Saqr bin Ghobash Saeed Ghobash.

The government will then “downgrade the company into the third category and enable the workers to move to another company”.

If two months pass without employees being paid, the company will be hit with administrative fines, as well as registered fines for failing to pay wages.

Administrative fines reach Dhs5,000 per worker’s delayed wage pay, stretching to a maximum fine of up to Dhs50,000 per employee in events which include multiple worker protests. 

HOW DOES IT WORK IN SMALLER COMPANIES?

For companies with less than 100 employees, they can face bans on work permits, to fines, to court referrals. However, these consequences will only be faced if the company fails to pay wages within two months.

If the company repeats such violations over the course of a year, then the ministry will apply the same penalties as are given to bigger companies.

HOW WILL THE GOVERNMENT KNOW?

How will the government monitor whether employees are being paid on time? Well companies are expected to use the government’s Wage Protection System so the Ministry can track payments.

And if they don’t use the system? “The decree clearly states the ministry shall not proceed with any transactions with companies that did not register in the WPS, in addition, to stop dealing with the owners of these companies until they register in the system, all to ensure workers’ rights have been met”.

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Photo: Getty