Minimum Wage Requirements UAE: A Comprehensive Legal Guide on Remuneration, Overtime, Bonuses, Leave, Gratuity, and Salary Protection

Minimum Wage Requirements UAE: A Comprehensive Legal Guide to Remuneration, Overtime, Bonuses, Leave, Gratuity and Salary Protection

Estimated reading time: 25 minutes

Key Takeaways

• Understand the federal Labour Law under Federal Decree-Law No. 33 of 2021 and its amendments.
• Recognise the AED 6,000 minimum wage for Emiratis effective 1 January 2026 and visa-linked salary thresholds for expatriates.
• Comply with overtime payment laws Dubai, statutory leave entitlements, bonus-deduction limits and gratuity calculations.
• Leverage the Wage Protection System to adhere to salary protection laws.
• Implement robust contracts, policies and payroll systems to mitigate regulatory and litigation risks.

I. Introduction: Current Remuneration Landscape

The United Arab Emirates’ private-sector wage framework is governed by Federal Decree-Law No. 33 of 2021, as amended by Federal Decree-Law No. 20 of 2023, and implemented via Cabinet Decisions and Ministerial Resolutions. MoHRE regulates wages, working hours, benefits and the Wage Protection System, establishing the modern minimum wage requirements UAE 2025 for nationals and visa-linked benchmarks for expatriates.

As at 13 January 2026, There is no legislated national minimum wage for expatriate employees under Federal Decree-Law No. 33 of 2021; wage levels for expatriates are guided by immigration salary benchmarks and market practice rather than a statutory minimum wage, but binding thresholds exist for Emiratis. There are no binding statutory wage thresholds for expatriate employees across all private sector roles under current federal legislation also; any salary benchmarks for visa issuance or renewal function administratively rather than as mandatory legal minimum wages. The Labour Law also prescribes overtime premiums, leave rules, end-of-service gratuity, and enforces payment through approved electronic channels.

II. Regulatory Framework Governing Remuneration and Salary Protection Laws

A. Federal Decree-Law No. 33 of 2021

Federal Decree-Law No. 33 of 2021, as amended, empowers MoHRE to set employment-contract standards, wages, working time, overtime, leave and end-of-service benefits. Article 33 mandates wage disclosure in MoHRE’s electronic system and payment via approved banking channels, underpinning salary protection laws.

B. Ministerial Resolutions & Cabinet Decisions

Ministerial Resolutions detail Wage Protection System obligations—uploading salary files monthly, meeting deadlines, and paying contractually specified wages—or face fines and permit suspensions. Domestic workers under Federal Decree-Law No. 9 of 2022 are likewise migrating into the electronic regime.

C. Free-Zone Regimes: DIFC, ADGM & JAFZA

Although mainland labour law applies broadly, free zones like DIFC and ADGM operate under separate employment statutes with their own enforcement, yet maintain similar salary protection laws. JAFZA contracts align with federal Decree-Law No. 33 and participate in the Wage Protection System for sponsored employees.

III. Minimum Wage Requirements UAE 2025 and the AED 6,000 Emirati Minimum

A. Expatriate Employees & De Facto Thresholds

No binding nationwide minimum wage exists for expatriates; instead, visa and work-permit salary benchmarks guide pay scales, typically ranging from AED 1,500–AED 6,000 per month depending on role and skill level.

B. AED 6,000 Emirati Minimum (Effective 1 Jan 2026)

MoHRE’s 31 Dec 2025 announcement set the private-sector minimum wage for Emiratis at AED 6,000/month. In fact, MoHRE has set the private-sector minimum monthly wage for Emirati nationals at AED 6,000, effective 1 January 2026; employers must align existing salaries by 30 June 2026 or face regulatory consequences under Emiratisation compliance criteria.

C. Impact on Emiratisation & Nafis Programme

Emirati wage compliance ties directly into Emiratisation quotas and Nafis targets, with non-compliant salaries excluded from quota counts and enforcement measures applied thereafter.

D. Benchmark Visa-Linked Categories

Practical salary ranges for domestic workers, semi-professionals, trades and administrative staff act as de facto minima, reflecting immigration criteria and cost-of-living standards.

IV. Overtime Payment Laws Dubai: Working Hours, Premiums and Enforcement

A. Statutory Working Hours & Overtime

Normal hours are 8/day or 48/week (40/week for hazardous roles). Overtime beyond these limits must comply with overtime payment laws Dubai and employer-approved procedures.

B. Premium Calculations at 125% & 150%

Overtime on working days requires a 25% premium (×1.25); rest days and public holidays a 50% premium (×1.5), based on the basic hourly wage.

C. Compensatory Time Off

Time off in lieu may substitute monetary premiums for rest-day or holiday work, subject to written agreement and statutory safeguards.

D. Enforcement & Dispute Resolution

MoHRE enforces overtime via inspections, WPS data and fines. Unresolved complaints escalate to the Labour Court after conciliation.

V. Bonus Deduction Legal Limits UAE: Structure, Deductions and Judicial Trends

A. Contractual vs. Discretionary Bonuses

Contractual bonuses form part of the wage; discretionary bonuses require clear reservation of employer discretion to avoid implied contractual entitlement under bonus deduction legal limits UAE.

B. Permissible Deductions & 50% Ceiling

Article 35 limits wage deductions to 50% per period—for advances, social-security contributions, court orders—requiring any offset across multiple cycles if necessary.

C. Prohibition on Unilateral Reductions

Employers cannot strip agreed bonuses without contract amendment or written employee consent; WPS monitoring may trigger sanctions under salary protection laws.

D. Judicial Trends on Bonus Offsets & Gratuity

Dubai courts bar broad set-offs of bonuses against gratuity, upholding statutory caps and emphasising documentation of payments.

VI. Leave Entitlement Calculation: Annual, Sick, Maternity, Paternity and Public Holidays

A. Annual Leave Accrual & Encashment

30 days/year after 1 year’s service; pro rata at 2 days/month for 6–12 months. Encashment at basic wage upon termination.

B. Sick Leave Entitlements

Up to 90 days/year: 15 days at 100% wage, next 30 days at 50%, remainder unpaid, subject to medical certificates.

C. Maternity, Paternity & Adoption Leave

Female employees receive 60 days (45 at full pay, 15 at half pay); male employees 5 days paid paternity leave; additional leave for complications or adoption.

D. Public Holidays

Federal labour regulations currently provide for a specified number of annual public holidays, determined by Cabinet resolution, which private sector employers must observe in addition to contractual entitlements; work on holidays entitles employees to a substitute day off or payment at 150% of basic wage.

VII. Gratuity Settlement Calculator: End-of-Service Benefits under UAE Law

A. Statutory Formula

Under Article 51 of Federal Decree-Law No. 33 of 2021 and its implementing regulations, the end-of-service gratuity is calculated as 21 days of the last basic wage for each year of the first five years’ service and 30 days for each subsequent year, subject to a maximum of two years’ basic wage. Methodology detailed in gratuity settlement calculator.

B. Resignation vs. Termination

No reduction for resignation after 1 year; gross-misconduct dismissals forfeit gratuity.

C. Pro Rata, Forfeiture & Documentation

Calculate service days ÷365, split rates, multiply by daily basic wage; maintain contracts and WPS records for verification.

D. Designing a Practical Calculator

Key inputs: start/end dates, last basic salary, termination type, unpaid-leave details; follow eight computation steps and validate with scenarios.

VIII. Salary Protection Laws and the Wage Protection System

A. Structure & Operation

The WPS mandates electronic wage payments via MoHRE-accredited banks, uploading detailed salary files each pay period to enforce salary protection laws.

B. 2025–2026 Coverage Expansion

The Wage Protection System applies to most private sector employees; recent regulatory developments are extending electronic wage monitoring to additional categories such as domestic workers under Federal Decree-Law No. 9 of 2022, subject to phased implementation to universalise wage protection.

C. Employer Obligations & Penalties

Pay within 10 days after period end; delays trigger fines, permit restrictions and possible criminal referral for willful non-payment.

D. Practical Compliance Strategies

Integrate payroll with WPS interface, select reliable banks, conduct audits, train HR/payroll teams on MoHRE updates.

IX. Practical Implications and Best Practices for Contracts, Policies and Dispute Management

A. Contract Drafting & Alignment

Ensure contracts reflect the AED 6,000 Emirati minimum, reference minimum wage requirements UAE 2025, overtime rules, bonus-deduction limits and statutory leave entitlements.

B. Internal Policy Development

Embed leave entitlement calculation, overtime request procedures, deduction caps and WPS compliance in HR policies.

C. Dispute Avoidance & Documentation

Maintain contracts, WPS files, payslips, attendance and leave records for at least 5 years; engage promptly with MoHRE conciliation.

D. Compliance Audits & Continuous Improvement

Conduct biannual reviews of contracts, payroll and policies; subscribe to MoHRE updates; implement corrective actions and staff training.

X. Conclusion and Future Outlook

The UAE’s remuneration framework strikes a balance between contractual freedom and statutory safeguards. The AED 6,000 Emirati minimum wage, visa-linked expatriate benchmarks and the integrated Wage Protection System exemplify robust salary protection laws. As the labour market evolves, employers and employees must continuously review contracts, systems and policies, staying alert to potential federal minimum-wage extensions and digital compliance innovations.

Frequently Asked Questions

• Q: Is there a universal minimum wage for expatriates?
  A: No statutory expatriate minimum wage exists; pay scales follow visa-linked thresholds and market benchmarks.
• Q: When does the AED 6,000 Emirati minimum apply?
  A: Effective 1 January 2026 for new and renewed Emirati work permits, with compliance required by 30 June 2026.
• Q: How is overtime calculated in Dubai?
  A: Overtime on workdays at 125% of hourly wage; on rest days/holidays at 150%, or compensatory time off by agreement.
• Q: What is the statutory cap on wage deductions?
  A: Permissible deductions (advances, social security, court orders) may not exceed 50% of the wage per pay period.
• Q: How do I calculate end-of-service gratuity?
  A: First 5 years at 21 days’ wage/year; thereafter at 30 days/year; capped at 2 years’ basic wage; pro rata for fractions of a year.