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New Labour Law & its relevance to Dispute Resolution

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Staff Writer, TLR

Published on July 14, 2023, 17:41:00


UAE, Labour law, contracts, dispute resolution, human resource

On February 2, 2022, Federal Decree-Law No. 33 of 2021 regulating labour relations in the private sector went into effect. The law is intended to strengthen workers' rights and increase the UAE's competitiveness as a location to live and work, assisting the region in attracting and retaining top talent.
Family leave rights, discrimination regulations, termination of employment, and 'non-compete' clauses in employment contracts have all seen significant modifications. Businesses can also implement part-time and flexible employment arrangements under the new rules. Below listed are the 10 key changes made in the law: -

1. UNLIMITED CONTRACTS ABOLISHED: Unlimited contracts will be phased out under Article 8 of the New Law, in favour of labour contracts with a defined length of three years that can be extended on the same terms with both parties' approval for a similar period or less.

2. EQUAL WORK MEANS EQUAL PAY: In addition to articles prohibiting discrimination based on race, sex, religion, and other factors, the New Law expressly states that all provisions governing the employment of workers without discrimination apply to working women, with a focus on ensuring that women are paid the same as men if they perform the same or similar work.

3. NEW CATEGORY OF LEAVES INTRODUCED: Employees will be able to request additional types of leave under the New Law, such as (i) three days of bereavement leave following the death of a close family member, (ii) five days of parental leave, to be taken intermittently or consecutively within six months of the birth of a child, and (iii) ten days of study leave for an employee who needs to take exams, provided they have worked for that employer for two years. Maternity leave will also be extended, with 45 days of full pay followed by 15 days of half pay.

4. MINIMUM WAGE: Article 27 of the New Law will establish a minimum salary, which will be a first for the UAE. Following a request by the Minister of Human Resources and Emiratisation, in conjunction with the necessary agencies, the UAE Cabinet will select and announce the minimum salary amount.

5. ABOLITION OF 1ST FEBRUARY AS NEW CONTRACT DRAFTING DAY: All private-sector employers will be forced to replace their existing employment contracts with contracts that conform with the New Law. Employers have a maximum of one Gregorian year from the date of the New Law's introduction, i.e. 1 February 2023, in which to do so.

6. WORKING WEEK REDUCED: The New Law also allows for a condensed working hours model, which allows for a shorter work week. According to Article 65 of the present law, the private sector's typical working hours are 8 hours per day or 48 hours per week. Employers now have the option of allowing their employees to work a condensed model of 40 hours a week, i.e. a 4-day week with 10 hours per day, under the new law. This move was most likely made in light of the public sector's new four-and-a-half-day workweek.

7. EXEMPTION FROM JUDICIAL FEES: Employees or their heirs may submit petitions, pursue litigation, or obtain enforcement orders against employers under the New Law without incurring judicial fees at any step of the procedure, as long as their claim is worth less than Dh100,000. The New Law further stipulates that the employer is responsible for all fees and expenses associated with recruiting and employment and that the company may not recoup these costs from the employee directly or indirectly.

In the event of a breach of the conditions or the employment contract, or of their rights under the Labour Law, the employer, the employee, or the employee's beneficiary can file a complaint with the Ministry of Human Resources & Emiratisation. After one year from the date of the violation, no claim for any rights due will be heard. When the case is in court, the employee can apply to the Ministry of Human Resources & Emiratisation for a temporary work permit to work for another employer until the case is concluded.
The following is a summary of the regulations and major provisions governing the filing and resolution of individual labour disputes in the UAE's private sector:

Cabinet Resolution No. 1 of 2022 on the Implementation Regulation of Federal Decree-Law No. 33 of 2021: Article 31 of Cabinet Resolution No. 1 of 2022 on the Implementation Regulation of Federal Decree-Law No. 33 of 2021 (PDF, 652 KB) states that an employer, an employee, or an employee's beneficiary can file a complaint with the Ministry of Human Resources and Emiratisation-concerned Ministry of Human Resource & Emiratisation's department regarding any of the rights they are entitled to under the 'UAE Labour Law.'

Ministerial Resolution No. 47 of 2022 Regarding the Settlement of Labour Disputes and Complaints Procedures: The Ministerial Resolution No. 47 of 2022 Regarding the Settlement of Labour Disputes and Complaints Procedures (PDF, 292 KB) mentions the following procedures and time frames for individual labour disputes:
• Within 30 days of a breach of the conditions of the employment contract, the UAE Labour Law, or its Executive Regulations, the employer and the employee have the right to submit a labour complaint.
• Individual labour concerns must be resolved within 14 days of receipt by the Ministry of Human Resource & Emiratisation.
• If an amicable settlement cannot be achieved within 14 days, the Ministry of Human Resource & Emiratisation will refer the case to the appropriate labour court.

In addition, an employee who has had a complaint against an employer referred to the court must follow the following guidelines:
1. Within 14 days of the referral to the competent court being approved, file the labour complaint with the appropriate court.
2. Working for another employer without temporary work authorization from the Ministry of Human Resource & Emiratisation is prohibited.
3. Within 14 days of the date a final judgement is delivered terminating the parties' employment connection and submit a request to cancel the initial work permit.
4. The worker may apply for a temporary work permit with a new employer during the process of the labour case, except for those who have been reported absent by their employers, by filing an ‘unexpected work abandonment Report’.

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