The UAE Ministry of Human Resources and Emiratisation (MOHRE) has officially confirmed that the Wage Protection System (WPS) is now mandatory for domestic workers. This electronic system allows employers to pay their domestic workers' wages through approved financial institutions, including banks and exchange houses, that are authorised by the Central Bank of the UAE.

Under Federal Decree-Law No. (9) of 2022, employers must ensure that wages are paid in UAE dirhams within a period not exceeding 10 working days from the due date. This system aims to enhance transparency and ensure timely wage disbursements, fostering better relationships between employers and domestic workers.

 

Key Benefits of the WPS System

The introduction of WPS offers several benefits:

• Employer’s right to prove wage payment through electronic records.

• Streamlined wage transfer process to ensure efficient payment.

• Timely wage disbursement, preventing delays and disputes.

• Stable employer-employee relationships with clear payment records.

 

Methods of Payment under WPS

MOHRE has outlined the following methods for wage payments under the system:

• Cash transfers through authorised banks, exchange houses, and financial institutions.

• Electronic transfers via smart applications provided by these institutions.

Employers must also register with an approved WPS agent authorised by the Central Bank to process payments.

 

Compliance and Enforcement Measures

The Ministry has stressed that all employers are obligated to register in the Wage Protection System and ensure compliance with wage payment regulations. Employers failing to process domestic worker wages through the WPS system within one month from the due date will be considered late. If wages remain unpaid for over two months, the employer’s file may be suspended by MOHRE.

 

Penalties for Non-Compliance

Employers who fail to adhere to the regulations outlined in Ministerial Resolution No. (675) of 2022 and Executive Regulation No. (106) of 2022, which apply to Federal Decree-Law No. (9) of 2022, may face administrative penalties. These laws ensure that all domestic workers receive their wages on time and under the new wage protection guidelines.

 

Professions Covered by WPS

The Wage Protection System applies to various domestic worker professions, with mandatory registration for the following positions as of April 1, 2023:

• Private Trainer

• Private Teacher

• Home Caregiver

• Private Representative

• Private Agricultural Engineer

The system is also available for other professions, such as housekeepers, nannies, drivers, cooks, and maids, though registration is optional for these roles.

 

Exemptions from WPS

The following domestic workers are exempt from wage transfers through the WPS system:

• Workers with pending labour disputes or absconding reports.

• New domestic workers within the first 30 days of their employment contract.

Conclusion

The new WPS system is a significant step towards ensuring fair and timely compensation for domestic workers in the UAE. Employers must comply with the new requirements to avoid penalties and ensure smooth operations under UAE employment law. Legal experts encourage employers to familiarize themselves with the wage protection system to avoid any disruptions in their employee relationships.

 

 

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