UAE Clarifies Rules on Salary Deductions for Late Attendance Under Updated Labour Law

Late arrival at work is a common workplace issue, but in the United Arab Emirates, the rules governing how employers may respond -- including whether they can deduct salary—are clearly defined in federal legislation. The UAE’s current labour framework, set out under Federal Decree-Law No. 33 of 2021 and its corresponding Cabinet Resolution No. 1 of 2022, establishes strict requirements that companies must follow before imposing any disciplinary sanction, including financial penalties.

This article provides a detailed explanation of the legal conditions, the permissible amount of deduction, and the procedural safeguards employees are entitled to.


1. Salary Deductions Are Allowed -- but Only as a Formal Disciplinary Sanction

Under Article 39(1) of the Labour Law (Federal Decree-Law No. 33 of 2021), employers may impose disciplinary penalties if an employee violates the law, internal policies, or the company’s approved disciplinary code. One of the permitted penalties is a salary deduction.

The law explicitly states that employers may apply:

“Deduction of a maximum of five (5) days per month from the salary.”

This means:

• Salary may be deducted only as part of a disciplinary procedure, not arbitrarily.
• The deduction must be linked to a breach, such as repeated late attendance.
• Employers cannot deduct more than five days’ salary in any month, regardless of how many violations occur.

2. Employers Must Have a Written Disciplinary Policy
   
   

Even if late attendance occurs, the employer cannot impose a salary deduction unless it is supported by a documented disciplinary framework.

Under Article 24(2) of Cabinet Resolution No. 1 of 2022, employers are legally required to:

• Prepare a written disciplinary code, listing all penalties allowed under Article 39 of the Labour Law.
• Clearly explain the types of violations and the corresponding sanctions.
• Communicate this code to employees (commonly via onboarding documents, email, noticeboard, or HR portal).

If an employer has no written schedule of penalties—or if the employee was never informed—the company may not legally impose salary deductions for late coming.


3. The Process That Employers Must Follow

To comply with UAE labour regulations, employers must apply disciplinary deductions through a transparent and fair procedure. This typically includes:

a. Documented Violation

The late attendance must be recorded through an official attendance system or other verifiable method.

b. Employee Notification

The employee should be informed of:

• The violation,
• The intended disciplinary action,
• The relevant clause in the company’s disciplinary code.

The law requires notice and an opportunity for the employee to understand or dispute the violation.

c. Proportional Penalty

Penalties must be:

• Appropriate for the violation,
• Applied consistently to all employees,
• In line with the maximum limit of five days’ salary per month.
  
  

d. Proper Record-Keeping

Employers must maintain a register of all disciplinary sanctions and the reasons behind them, as required by labour inspectors.

4. How the Deduction Is Calculated
   
   
   Salary deductions must be calculated based on the employee’s daily wage, determined by dividing the monthly salary by the statutory number of working days (usually 30 days unless a different calculation method is specified in the contract).

For example:

• Monthly salary: Dh6,000
• Daily wage: Dh6,000 ÷ 30 = Dh200
• Maximum monthly deduction permitted by law: 5 × Dh200 = Dh1,000

No employer may exceed this ceiling.

5. Do Employees Have the Right to Challenge a Deduction?
   
   

Yes. Employees may raise concerns if:

• The deduction was not listed in the disciplinary policy,
• The employer did not follow proper notification procedures,
• The deductions exceed the five-day monthly limit,
• The employer has applied sanctions inconsistently or unfairly.

Concerns can be addressed internally with HR or escalated to:

• The Ministry of Human Resources and Emiratisation (MoHRE) through a labour complaint.

The ministry may investigate and direct the employer to reverse or amend the deduction if it violates labour laws.


Conclusion

Under UAE labour law, employers may deduct salary for late attendance, but only within a strict legal framework. Key requirements include:

• A written disciplinary code, properly communicated to employees.
• A clear and fair disciplinary process.
• A maximum deduction limit of five days’ salary per month.
• Proper notification and consistent application of penalties.
  
  

For employees newly joining a company, it is important to review the internal disciplinary policy to understand how late attendance is handled. If a deduction appears arbitrary or is imposed without documentation, UAE law provides mechanisms to protect employee rights.

 

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