UAE’s new and old labour laws compared: What are the main changes?
A look at the new provisions as Federal Decree-Law No. 33 of 2021 comes into effect today
Dubai: The UAE’s new Labour Law has come into effect today, February 2.
The new law – Federal Decree-Law No. 33 of 2021 – which replaces the earlier legislation - Federal Law No. 8 of 1980 – covers the entire gamut of labour relations. It has introduced a series of changes to the previous law.
Below is a comparison of the previous and new laws with a focus on the major changes:
Labour contract
Previous law: There are two types of contracts : Limited and unlimited
New lew: Limited contracts only.
Termination / Resignation during probation
Previous law: No notice period is required to be given by either party.
New law: Employer must give a notice of 14 days to terminate the contract during probation period, which will not be longer than six months. Employees who want to change jobs during the probation period must give a month’s notice, or 14 days if they want to leave the country. In this case, the new employer will have to compensate the old employer for the visa costs and expenses for the hiring of the ex-employee, if specified in the labour contract. If an employee leaves the country then returns to take up a new job within three months, the new employer would have to pay the former employer for the visa costs and the labour expenses incurred, if specified in the labour contract.
If an employee leaves the country without any notice, the company reserves the right to recommend Labour Department to impose a one-year ban.
Passport
Previous law: The practice of employers withholding the passports of its foreign employees is prohibited under Circular No. 267 of 2002 issued by the Ministry of Interior (MoI) - unless it is carried out by the judicial authorities in accordance with relevant provisions of the law. However, if the employee consents to handing over the passport, then such possession of the employee’s passport by the employer shall not be deemed unlawful, provided the employee’s consent is obtained in writing and the employer agrees to return the passport at the employee’s request.
New law: The employer cannot confiscate the official documents of employees, and it is illegal to hold an employee’s passport as per the new law.
Study leave
Previous law: Not specified.
New law: After completing two years of work term with an employer, workers are entitled to 10 days study leave in a year, provided that they are enrolled in an accredited institution within the UAE.
Annual leave entitlement
Previous law: 30 calendar days per annum upon completion of one year of service.
New law: 30 calendar days per annum upon completion of one year of service.
Annual leave accrual
Previous law: Two days a month, if an employee’s period of service is less than one year. 30 days a year, if an employee’s service is more than or equivalent to one year.
New law: Two days a month, if an employee’s period of service is less than one year. 30 days a year, if an employee’s service is more than or equivalent to one year.
Annual leave during probation
Previous law: During probation, the annual leave is unpaid.
New law: During probation period, annual leave can be taken based on the actual accrual.
Annual leave carry forward
Previous law: Annual leave can be carried forward to the following leave year. Forfeiting of annual leave is not allowed.
New law: Carry forward of unused leave is subject to employer approval. Employee must take leave in its year of entitlement.
Public holidays during annual leave
Previous law: Not specified.
New law: If a public holiday falls during the period of annual leave, it will be counted as annual leave only. Public holiday will not be excluded from the annual leave days
Leave encashment (Annual + Leave in Lieu)
Previous law: Basic + HRA.
New law: Only on basic salary.
Maternity leave
Previous law: A woman employee is entitled to 45 days maternity leave with full pay after completion of one year of continuous service with the Company. If the period of service is less than one year, then maternity leave is paid on half pay basis.
New law: A woman employee is entitled to 45 days maternity leave with full pay regardless of the period of service. This can be extended by another 15 days of leave with half pay.
Maternity leave during miscarriage / still birth / upon death of an infant after birth
Previous law: Not specified.
New law: Maternity leave also applies in circumstances where an employee miscarries after six months of pregnancy. In this case the maternity leave still applies i.e. A woman employee is entitled to 45 days maternity leave with full pay regardless of the period of service. This can be extended by another 15 days of leave with half pay. Further 45 days of extension without pay can be taken for pregnancy related sickness. An appropriate medical certificate must be produced.
Maternity leave after the child is born - disabled child or sick child
Previous law: Not specified.
New law: If the pregnancy results in delivery of a disabled or sick child, the employee is entitled to 30 days of full pay leave starting after the end of the maternity leave. This can be further extended by another 30 days without pay.
Compassionate leave
Previous law: Not specified.
New law: Type 1 - Death of Spouse - Paid leave of 5 days in the event of the death of spouse Type 2 - Death of other relatives - Paid leave of 3 days in the event of the death of parents, grandparents, siblings, children or grandchildren.
Nursing breaks
Previous law: Two breaks for half an hour each for a period of 18 months.
New law: One or two breaks not exceeding 1 hour a day for a period of 6 months.
Settlement of gratuity
Previous law: Less than one year - no gratuity; after one year but before completion of three years of service - seven days basic salary per working year; after three years but before completion of five years of service - 14 days basic salary per working year; after five years of service - first five years on 21 days of basic salary per year and subsequent years on 30 days of basic salary per year.
New law: Less than one year - no gratuity; less than five years of service - 21 days of basic salary per working year; after five years of service - first five years on 21 days of basic salary per year and subsequent years on 30 days of basic salary per year.
Non-competition clause
Previous law: Not specified.
New law: Non-competition clause can now be written into a contract. The maximum restrictive period is 2 years from the date of termination.
Rest day
Previous law: If the work circumstances require that the Worker be employed on the rest day specified in the Employment Contract, or the internal work regulations, he shall be compensated with a substitute rest day.
New law: Everyone must have at least one rest day, with the option of more depending on their contract.
Termination of contract - specific to unauthorised absence
Previous law: Absent from over 10 inconsecutive days in one year, or over seven consecutive days without informing the employer.
New law: Absent from over 20 inconsecutive days in one year, or over seven consecutive days without informing the employer.