Employer Payroll Tax
Employee Payroll Taxes
Employee Income Tax
For expatriates, there is no mandatory minimum wage.
For UAE nationals, minimum wage is determined by level of education:
- No high school certificate- 3,000 AED
- High school certificate- 4,000 AED
- College degree or higher- 5,000 AED
If an employee receives an annual or monthly salary, the payroll cycle is monthly with payments paid no later than the 10th of the following month on a working day. If the pay date is not written in the employment contract, the payroll cycle is every 14 days.
The workweek in the UAE is from Sunday to Thursday with full-time employment considered 48 hours weekly and 8 hours daily.
For businesses, hotels, and cafes employees, the workday is 9 hours.
During Ramadan, working hours are reduced by 2 daily.
Overtime pay is paid at a rate of 125% of the regular pay, however, for overtime hours worked between 9 pm and 4 am, overtime is calculated at 150% of the regular pay.
For work on Fridays, the employee is entitled to an additional paid day off and overtime pay at the rate of 150% of the regular pay.
If an employee has fulfilled at least one year of employment, they are entitled to 30 days of paid leave a year.
7 holidays totaling 14 days.
After 3 months of employment starting from the end of the probation period, an employee is entitled to 90 days of sick leave.
The first 45 days of sick leave are paid as follows:
- First 15 days of illness- leave is paid at 100% of the regular salary
- 15-30 days of illness- paid at 50% of the regular salary
From the 46th day, sick leave is not paid.
Within the first 2 days of the sickness, the employee must give notice to their employer and produce a medical certificate from a doctor.
A woman is entitled to 45 days of fully paid maternity leave if they have completed at least 1 year of employment.
For women who work under the DIFC employment law, maternity leave is 65 days if the woman has worked for at least 1 year. The first 33 days are paid at a rate of 100% of the normal pay and the remaining 32 days is paid at the rate of 50% of the regular pay.
Paternity leave falls under parental leave.
For private-sector employees, both parents are entitled to 5 days’ paid leave. The leave can be taken until the child reaches the age of 6 months.
Under the DIFC, pregnant employees are entitled to paid leave for prenatal care.
The termination of an employment agreement must be given in writing.
For expatriates, the final payment is made when the employment visa is canceled. In addition, the employer is obligated to notify the authorities when an employee leaves the UAE.
A minimum of 30 days of advance notice is required by law. The employer can choose to give pay in lieu of notice if they so choose.
Under the DIFC employment law, notice period depends on the length of service:
- 1-5 months of employment- 1 weeks’ notice
- Up to 5 years or employment- 30 days’ notice
- 5+ years of employment- 90 days’ notice
DIFC also allows for pay in lieu of notice.
The amount of severance pay is determined by the length of employment:
- 1-5 years of employment – the employee is entitled to 21 days of wages for each year employed
- 30 days of wages for each additional year after 5 years of service.
- The total amount of severance cannot be more than a total of 2 years’ salary.
If the reason for termination is not recognized by UAE law, the employee may be entitled to additional compensation totaling 3 months’ pay.
The probation period can last a max of 6 months.
The standard rate is 5%.