UAE wages fully paid within 10 days of due date

If the company fails to pay wages for 60 days from the due date, then administrative fines shall follow (File)

The Ministry of Human Resources and Emiratisation has launched a new decree to ensure employees’ wages are fully paid within a period not exceeding 10 days from the due date as registered in the wage protection system (WPS).

The decree will come into force in October, 2016.

Saqr bin Ghobash Saeed Ghobash, Minister of Human Resources and Emiratisation, said companies employing more than 100 workers must pay wages within a period not exceeding 10 days.

If they fail, the ministry will stop granting them any additional work permits starting from the 16th day from the date of delay.

"Two main points should be considered in this matter: firstly, salary delays occur usually if the company fails to pay wages a month from the due date, the second, which refers to completely refraining wages, starts after entering into the second month. However, the decree shall refer to each case in a different matter," he said.

The decree states that if a company delays wages by one month from the due date, which means the company has entered into the refrainment phase, 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.

Furthermore, if a company continues to refrain from paying wages, the ministry shall take necessary measures to use the bank guarantee, in addition to downgrading the company into the third category and enabling the workers to move to another company.

"If the company fails to pay wages for 60 days from the due date, then administrative fines shall follow, not forgetting the punishments that had been already meted out for failing to pay wages a month from the due date," Ghobash added.

Administrative fines hit Dh5,000 per worker’s delayed wage, up to a maximum of Dh50,000 in cases that include multiple workers complaining about delayed wages for over 60 days.

On the positive side, the ministry will lift the ban from violating companies granting them the ability to apply for new work permits if they immediately pay delayed wages during the first delay month, while the ban will last for 60 days for companies that fail to pay wages for more than two months.

The Decree reiterates that if a company frequently refrains salaries, the ban duration will double, after paying the wages.

Additionally, if the ministry comes across any sort of salary delays or refrains by companies that employ less than one hundred workers, the current regulations shall apply, from work permit ban to fines, then public trial referral if the company fails to pay the money within 60 days. However, if the company records such violations more than once per year, then, in this case, the ministry shall apply the penalties as above for companies that employ over 100 workers.

The decree clearly states that the Ministry shall not proceed with any transactions with companies that do not register for the wage protection system. In addition, it will stop dealing with the owners of these companies until they register in the system, thus ensuring that workers' rights have been met.