Dubai: Private sector workers in the UAE who have not received their entitlements like gratuity or overtime pay, can now expedite the process to collect their overdue claims. Since January 1, 2024, the labour complaints process in the UAE private sector has been updated, after the revised legislation - Federal Decree-Law No. 20 of 2023 - came into effect.
Under the new law, the Ministry of Human Resources and Emiratisation (MOHRE) will issue the final executive decisions on labour disputes with claims of less than Dh50,000 made by either companies and workers in the private sector.
Gulf News spoke to two UAE-based legal experts to break down the new legislation and understand how the amendment will help workers in the UAE.
5 major changes to labour disputes in the UAE
Here is a summary of the changes in the new law and how it will impact the labour dispute resolution process:
1. MOHRE’s decision now legally enforceable
Previously, MOHRE adopted the mediator role in labour disputes, now the authority’s decisions are legally enforced through the ‘writ of execution’ – a court order that enables a creditor to enforce a judgment against a debtor.
“If the dispute involves a claim not exceeding Dh50,000, or if there is non-compliance with a previously issued amicable settlement, MOHRE can make a final decision. This decision holds the power of a writ of execution and is enforceable,” Dubai-based legal associate Tim Al-Ghraoui from multi-national law firm KN Legal said.
If the dispute involves a claim not exceeding Dh50,000, or if there is non-compliance with a previously issued amicable settlement, MOHRE can make a final decision. This decision holds the power of a writ of execution and is enforceable.
2. Right to appeal
Although MOHRE now has the power to issue a ‘writ of execution’ the employer or employee has the right the file an appeal.
“Parties may appeal to the Court of Appeal within 15 working days of notification of the MOHRE’s decision,” Al-Ghraoui said.
The decision of the Court of Appeals will constitute a final verdict, and an appeal will suspend the implementation of MOHRE’s decision, according to Article 1 of the new law.
3. Limit the claim value for labour disputes
“Before this amendment, MOHRE's role was mainly to mediate disputes and refer unresolved cases to judicial courts. Now, for the first time, MOHRE is empowered to make binding decisions in straightforward labour disputes where the claim's value does not exceed Dh50,000, or in disputes arising from a breach of any prior amicable settlement endorsed by the Ministry, regardless of the claim’s financial value. This could result in quicker resolution for minor disputes, freeing up judicial resources for more complex cases,” Suneer Kumar, senior law associate at UAE-based law firm, Al Suwaidi and Company, said.
“For disputes exceeding the [Dh50,000] threshold, MOHRE’s role remains unchanged, MOHRE’s capacity will be limited to act as a mediator and refer the matter to the court if an amicable settlement is not reached,” Suneer Kumar, senior law associate at UAE-based law firm, Al Suwaidi and Company, said
For disputes exceeding the [Dh50,000] threshold, MOHRE’s role remains unchanged, MOHRE’s capacity will be limited to act as a mediator and refer the matter to the court if an amicable settlement is not reached
- if the claim amount is under Dh50,000;
- or on disputes related to non-commitment to amicable settlement decisions previously resolved by MOHRE, regardless of the claimed amount.
4. Statute of limitation for labour claims
There is a standard one-year statute of limitation for employment claims, starting from the date the claim becomes due. This means that you can raise the complaint with MOHRE within a year of the issue arising, or the claim becoming due.
“After this period, the right to sue is lost regardless of the merits of the claim,” Kumar said.
5. Workers receive their salary during ongoing labour disputes
Kumar explained that as per the amendment, MOHRE can oblige the employer to continue paying the employee’s salary during the dispute for up to two months, if the dispute caused the suspension of the employee’s salary.
What happens if the labour dispute is not solved?
According to updated legislation, if both parties do not reach a settlement or resolution, the dispute will be referred to a competent court.
“If an amicable settlement is not reached within 14 days, MOHRE refers the dispute to the courts, along with a summary of the dispute and its recommendations,” Al-Ghraoui said.
What are the types of labour complaints that will brought before MOHRE?
“It is worth noting that the Decree-Law does not impose specific limitations on the nature of claims that can be adjudicated, provided that the claim's value does not exceed Dh50,000. This broad scope facilitates the efficient handling of a diverse array of employment-related disputes. We may see further statutory amendments or ministerial guidance that narrow this scope,” he said.
According to Al-Ghraoui, examples of claims that can be brought before the MOHRE include:
1. Unpaid wages or end-of-service benefits: Cases where employees seek payment of overdue salaries, overtime, or end-of-service entitlements like gratuity.
2. Wrongful termination claims: Disputes related to alleged illegal dismissal or termination without appropriate notice or valid reason.
3. Leave and working hours discrepancies: Matters concerning annual, unpaid, or maternity leave, as well as disputes over working hours.
4. Employment contract disputes: Issues arising from disagreements over employment contract terms, including job roles, remuneration, or contract duration.
5. Workplace discrimination or harassment: While less frequent, claims involving workplace discrimination or harassment based on protected characteristics such as gender, race, or religion.