UAE Employers Face Fines Of Up To Dh1 Million For Sponsoring Employees Who Do Not Work For Them

UAE employers who sponsor foreign workers but fail to provide them with employment may face substantial financial penalties under the country’s immigration and labour laws. The applicable provision depends on the circumstances, particularly whether the worker was never employed by the sponsoring company or initially worked there before being allowed to work for another employer.

Article 25(2) of Federal Decree-Law No. 29 of 2021 Concerning Entry and Residence of Foreigners provides for a fine of Dh50,000 where an employer recruits a foreigner for employment but fails to employ that person or allows the individual to work for another party without following the prescribed legal procedures. The fine may be multiplied according to the number of workers involved.

Article 60 of Federal Decree-Law No. 33 of 2021 Regulating Labour Relations, as amended by Federal Decree-Law No. 9 of 2024, provides for fines ranging from Dh100,000 to Dh1 million for recruiting or employing a worker and leaving them without work. The provision also addresses fictitious appointments and other specified labour violations.

The distinction between the two laws was examined by the Dubai Court of Cassation in Criminal Cassation No. 720/2024, in a judgment dated January 22, 2025. The court distinguished between a worker who had actually worked for the sponsoring employer before being permitted to work elsewhere and one who was brought into the UAE for employment but was never employed by that sponsor.

In the first situation, the Labour Relations Law applies; in the second, the law governing the entry and residence of foreigners is applicable. The competent authorities and courts may exercise their respective powers according to the nature of the violation and the applicable legal framework.