The UAE government has recently introduced a significant update to the Federal Decree-Law Regarding the Regulation of the Employment Relationship, commonly known as the “UAE Labour Law”. This Federal Decree-Law amends specific provisions of the existing employment regulations to enhance the effectiveness and clarity of the legal framework governing employment relationships in the UAE.
Overview of the Amendments
The new decree, a part of the UAE’s efforts to improve its legislative environment, aims to increase the efficiency and competitiveness of the labour market. The changes are designed to regulate employment relationships better and clearly define employers’ and employees’ rights and obligations, ensuring comprehensive protection under the law.
Key Changes and Their Implications
Enhanced Penalties for Employment Violations
One of the most notable changes is the imposition of stricter penalties for violations related to employment permits and worker rights. Employers who hire workers without a valid permit, fail to provide jobs to those they bring into the country, misuse work permits, or close down a business without settling workers’ rights will face fines ranging from AED100,000 to AED1 million. This is also applicable to cases involving the illegal employment of minors or allowing minors to work in contravention of the law.
The new decree emphasizes the importance of compliance with employment laws and aims to deter employers from engaging in practices that undermine the legal framework governing worker rights.
These penalties are intended to reinforce the responsibility of employers to adhere to legal standards and ensure fair treatment of workers.
Fictitious Recruitment and Emiratisation
The decree introduces criminal penalties for fictitious recruitment practices, including fraudulent Emiratisation. Employers who are found guilty of fabricating recruitment records or engaging in deceptive Emiratisation practices will face fines ranging from AED100,000 to AED1 million. Notably, these penalties will be multiplied by the number of workers involved in the fictitious employment.
This change underscores the UAE government’s commitment to combatting fraudulent practices in the labour market. By imposing severe penalties, the decree aims to encourage employers to maintain integrity in their recruitment processes and contribute to genuine Emiratisation efforts.
Dispute Resolution and Legal Proceedings
In cases of labour disputes, the new decree mandates that disagreements with decisions issued by the Ministry of Human Resources and Emiratisation (MOHRE) must be taken to the Court of First Instance, rather than the Court of Appeal. Additionally, the decree stipulates that claims filed more than two years after the termination of the employment relationship will not be entertained by the courts.
This adjustment aims to streamline the dispute resolution process and ensure that cases are addressed promptly. By designating the Court of First Instance as the appropriate venue for such disputes, the decree seeks to provide a more efficient legal process for resolving employment-related issues.
Settlement and Financial Penalties
The decree grants the Ministry the authority to settle cases involving fictitious employment before a court decision is rendered. Employers can request settlement by paying at least 50 percent of the minimum specified fine and reimbursing the government for any financial incentives received by fictitious employees.
This provision offers a potential pathway for employers to rectify their violations and avoid more severe penalties.
Impact on Employers and Workers
For Employers
The new amendments will require employers to review and adjust their compliance practices to align with the updated regulations. The introduction of significant fines and criminal penalties for non-compliance highlights the importance of adhering to the legal framework governing employment relationships.
Employers should ensure that their recruitment and employment practices are transparent and in accordance with the law to avoid substantial financial and legal repercussions.
For Workers
For workers, these amendments offer enhanced protection against illegal and unfair employment practices. The stricter penalties for violations related to work permits and employment rights are intended to safeguard workers from exploitation and ensure that their rights are upheld.
The new legal provisions aim to create a more secure and equitable working environment in the UAE.
UAE Federal Decree-Law Amends Employment Relationship Regulations
The recent amendments to the UAE Labour Law reflect the UAE government’s ongoing commitment to developing a robust and transparent employment framework. By introducing stricter penalties and revised procedures for dispute resolution, the new Federal Decree-Law seeks to improve the regulation of employment relationships and enhance the overall efficiency of the labour market.
Employers and workers alike must stay informed about these changes to ensure compliance and protection under the law. For more information on the latest updates and how they may affect you, visit the Ministry of Human Resources and Emiratisation.
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