UAE: Wages Protection System Amended

United Arab Emirates News developments

UAE: Wages Protection System Amended

The UAE’s Minister of Human Resources and Emiratisation has issued Ministerial Decision No. 346/2022, amending Ministerial Decision No. 43/2022 on the Wages Protection System.

Under the amendments, the Ministry of Human Resources and Emiratisation will take various administrative procedures against establishments that do not comply with the System.

The measures taken will depend on the length of delay in paying salaries, the size of the establishment and the number of employees who have not been paid.

The Ministry will also monitor establishments registered in its database, regardless of their size, through field visits and an electronic monitoring and inspection system to ensure it pays its employees on time.

In addition, the Ministry will issue reminders and notifications to non-compliant establishments. Where no action is taken following the receipt of notifications, the issuing of new work permits for these entities will be suspended.

The amendments include procedures which will be taken gradually against establishments that employ 50 or more people, where the relevant Public Prosecution will be notified. The establishment information will be sent to the appropriate local and federal authorities for further legal action.

The respective department in the Ministry will follow up on the establishment.

All non-compliant establishments, regardless of their size, that fails to pay wages four months after the date they are owed will not be able to apply for any new work permits. If the employer operates other establishments listed with the System, similar penalties will be applied to each after notifying the affected establishments about the suspension of work permits.

If the establishment repeats the same violation within six months, an administrative fine will be imposed on them in line with Cabinet Decision No. 21/2022.

The establishment will also be downgraded to Tier three under the Ministry’s establishments classification system.

Establishments will be able to submit requests for exemption from transferring their wages through the System if they are seamen or sailors working on board vessels or ships and workers of foreign establishments or their subsidiaries operating in the country who receive their wages from outside the country, subject to the workers’ consent.

These exemptions are in addition to exemptions for fishing boats owned by UAE nationals, public taxis owned by UAE nationals, banks and places of worship and also reported in Al Bayan on 28 July 2022. For the full story, click here.

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Benjamin Filaferro