Employee benefitsin the United Arab Emirates

Employers in Abu Dhabi must buy health insurance for every employee and for the employee’s wife and up to three children under 18, under the emirate’s health insurance law (Law No. 23 of 2005) enforced by the Department of Health – Abu Dhabi (DOH), the emirate’s health regulator. The employer pays the premium. Cover must be in place when residence visas are issued or renewed, and since February 2025 the policy must include pregnancy and childbirth services for every woman the employer is obliged to insure, from subscription, renewal or a change in marital status. Family members the employer is not obliged to cover, such as additional children, must be insured by the head of household.

Employers in Abu Dhabi Global Market (ADGM), the emirate’s financial free zone, follow the same Department of Health requirements for employees and their dependants. Employees holding a Golden Visa may choose to keep their own cover.

Since 1 January 2025 a federal Cabinet decision has required employers in Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah and Fujairah to provide health insurance for private-sector employees and domestic workers, completing nationwide coverage alongside the long-standing Abu Dhabi and Dubai schemes. The employer pays and must buy the policy before a residence visa is issued or renewed; employees whose work permits were issued before 2025 must be insured at their next renewal.

The Ministry of Human Resources and Emiratisation (MoHRE), the federal labour ministry, launched a basic compliant package costing AED 320 a year, sold as a two-year policy with the second year refunded if the visa is cancelled. It covers ages 1 to 64, covers chronic and pre-existing conditions without a waiting period, and excludes pregnancy, childbirth and dental care. Employees pay 20% of hospital bills up to AED 500 per visit and AED 1,000 a year, 25% of outpatient bills up to AED 100 per visit (follow-up within seven days free), and 30% of medicines up to AED 1,500 a year. Employers may instead buy any compliant product from an approved insurer; dependants can be added on the same terms.

Health insurance for employees is compulsory in every emirate, but the legal minimum is basic: in Dubai and the northern emirates employers need only insure the employee, and the basic plans carry co-payments and modest annual limits. Some employers, particularly those competing for professional staff, buy broader group plans that raise annual limits, reduce co-payments, widen hospital networks, add international or home-country cover and include the employee’s spouse and children. In Abu Dhabi, cover for the spouse and up to three children under 18 is already a legal requirement.

Some employers pay a family healthcare allowance instead of insuring dependants directly. Outside the legal requirements, the employer decides whether to include dependants and how much of their premium to fund.

Some employers provide mental-health support in addition to health insurance. An employee assistance programme (EAP) provides confidential counselling and advice to help employees manage personal or work-related difficulties. Employees surveyed in the region rank health and wellbeing, including mental-health support, among the benefits they value most.

Some employers provide gym memberships, a monthly wellness allowance or wellbeing programmes such as health checks and fitness challenges. Guides cite wellness allowances of about AED 200 a month. Employees in the region rank wellbeing just behind health insurance among the benefits they value most, well ahead of perks such as free food.

Under the federal labour law, an employer whose employee suffers a work injury or occupational disease must pay for treatment until recovery or until disability is established. Work injuries include accidents on the normal commute to and from work. While the employee cannot work, the employer pays full wage for the treatment period or six months, whichever is shorter, then half wage for up to another six months or until recovery, disability or death is established.

If the injury or disease causes death, the family receives compensation equal to 24 months of the employee’s basic wage, with a minimum of AED 18,000 and a maximum of AED 200,000, in addition to end-of-service benefits and other dues. Permanent disability compensation follows a Cabinet table. No compensation is due if the injury was self-inflicted, caused by intoxication, deliberate breach of posted safety instructions or wilful misconduct. Federal law sets no statutory insurance premium; employers can buy workers’ compensation insurance to fund the liability.

Emirati employees in the private sector must be registered with the General Pension and Social Security Authority (GPSSA), the federal pension fund, which pays retirement, disability and survivor pensions. Under the 2023 pension law, members insured from October 2023 contribute 11% of their contribution salary and employers 15%, a total of 26%. Where the contribution salary is below AED 20,000 a month, the government pays 2.5 points of the employer’s share, so the employer pays 12.5%. The contribution salary is basic pay plus fixed allowances such as housing, between a floor of AED 3,000 and a private-sector ceiling of AED 70,000 a month.

Emiratis insured before the 2023 law stay on the 1999 rules: 5% from the employee, 12.5% from the employer and 2.5% from the government, on contribution salary capped at AED 50,000. Employers must register a new Emirati employee within one month of joining and pay contributions monthly, by the 15th of the following month; late registration costs AED 200 a day. Expatriate employees are not covered by any public pension and instead receive end-of-service gratuity. Abu Dhabi nationals working in Abu Dhabi contribute to the Abu Dhabi Pension Fund instead.

The Involuntary Loss of Employment (ILOE) scheme is compulsory unemployment insurance under Federal Decree-Law No. 13 of 2022. Employees buy and pay for the policy themselves; employers are not charged. The premium is AED 5 a month for employees with basic salary up to AED 16,000 (category A) and AED 10 a month above that (category B), plus value added tax, payable monthly, quarterly or annually. Failing to subscribe, or failing to pay premiums, each carries a AED 400 fine.

After at least 12 consecutive months of contributions, an employee who loses their job for reasons other than resignation or disciplinary dismissal receives 60% of their average basic salary over the previous six months, capped at AED 10,000 a month in category A and AED 20,000 in category B. Payments last up to three consecutive months per claim, stop if the person finds new work, and cannot exceed 12 monthly payments over a working life in the country.

In Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, employees with at least one year of continuous service receive an end-of-service gratuity whatever the reason for termination, including dismissal for cause. It equals 21 days’ basic wage for each of the first five years and 30 days’ basic wage for each further year, pro rata for part-years, capped at two years’ wages. The daily rate is annual basic wage divided by 365, and basic wage is treated as at least 50% of total wages, so packages weighted towards allowances do not shrink the payment.

The employer must pay gratuity with all other final dues within 21 calendar days of termination, or pay a daily-wage penalty for each day late, up to six months’ wages. Employers may offer a pension or savings plan instead; the employee chooses in writing and does not receive both. Emirati and Gulf nationals enrolled in a state pension receive no gratuity.

Employers in the Dubai International Financial Centre (DIFC), Dubai’s financial free zone, must pay monthly end-of-service contributions into a qualifying savings scheme, most commonly the DIFC Employee Workplace Savings (DEWS) plan, instead of accruing a lump-sum gratuity. The minimum is 5.83% of monthly basic wage for the first five years of service and 8.33% for each later year, counting service before the scheme began on 1 February 2020. Contributions start from the first month of employment and the employee keeps the invested balance whatever the reason for leaving.

Service before 1 February 2020 still earns the old gratuity – 21 days’ basic wage a year for five years, then 30 days, capped at two years’ wage – unless transferred into the scheme with the employee’s consent. For gratuity calculations basic wage counts as at least 50% of total wage. Emirati and other Gulf national employees are registered with the federal pension authority instead; since 1 April 2024 the employer must top up the difference into a qualifying scheme where their pension contribution falls short of the DEWS equivalent by AED 1,000 a month or more.

Expatriate employees who complete at least one year of continuous service receive a lump-sum end-of-service gratuity when employment ends, under Article 51 of the federal labour law. It equals 21 days’ basic wage for each of the first five years and 30 days’ basic wage for each further year, pro rata for part-years, calculated on the last basic wage (excluding housing, transport and other allowances). Total gratuity cannot exceed two years’ wage. Unpaid absences do not count towards service. For example, an employee with seven years’ service receives 105 days’ basic wage for the first five years plus 60 days for the next two, 165 days in total.

The 2021 law removed the old reductions for employees who resign, so gratuity is due on resignation as well as termination. The employer pays it with all other final dues within 14 days of the contract ending and may deduct only amounts owed under law or a court judgment. Employees with less than one year’s service receive no gratuity. Emirati employees receive pension benefits instead. Employers may opt into a government-approved savings scheme that replaces future gratuity accrual with monthly investment contributions.

Since October 2023, private employers may replace future end-of-service gratuity with monthly contributions to an approved investment fund under Cabinet Resolution No. 96 of 2023. Joining is voluntary for the employer, which chooses which employee groups to enrol; enrolment is then compulsory for those employees, and the employer must stay in for at least one year. The employer contributes 5.83% of monthly basic salary for employees with up to five years’ service and 8.33% after five years, on top of salary. These rates mirror the 21-day and 30-day gratuity formula, but the fund has no two-year cap.

Employees may add voluntary savings of up to 25% of their monthly wage through payroll or as lump sums, and can withdraw those voluntary amounts during employment. Funds offer capital-guaranteed, risk-based and Sharia-compliant options; lower-skilled workers must use the capital-guaranteed option. On leaving, the employee receives employer contributions and returns within 14 days or can keep them invested. Gratuity earned before enrolment is fixed at the basic salary on the enrolment date and paid by the employer when employment ends. The Ministry of Human Resources and Emiratisation (MoHRE) and the Securities and Commodities Authority supervise the scheme.

Group life insurance, which pays a lump sum to an employee’s family if they die during employment, is a standard part of packages offered by multinational employers and firms in the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM). It is not required by law: the only statutory death benefit is the work-injury compensation of 24 months’ basic wage (AED 18,000 to AED 200,000) for deaths caused by work, plus end-of-service dues. Employer-paid cover applies to death from any cause during employment and is often combined with disability benefits in a single policy. The sum insured is set by the employer’s policy.

Some employers provide group disability or income protection insurance, which replaces part of an employee’s income or pays a lump sum if illness or injury prevents them from working. Statutory protection is limited to work injuries (full wage for six months, then half wage for up to six months) and up to 15 days’ full and 30 days’ half sick pay a year for other illnesses, so private cover fills the gap for long-term illness. Cover is often bundled with group life insurance. Insurers report that claimants are getting younger and that smaller businesses are adding income protection and critical illness cover.

Expatriate employees have no public pension, so their main statutory retirement benefit is the end-of-service gratuity. Some employers go further by funding gratuity through an investment scheme – either the federal voluntary savings scheme approved in 2023 or, in the financial free zones, an employer pension offered in place of gratuity – or by offering an international savings plan. Plan design, contribution levels and vesting are set by each employer.

Employees in Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, are entitled to at least 20 working days of paid vacation leave a year, in addition to public holidays. Leave accrues monthly at one-twelfth of the annual entitlement from the first day of employment, and only accrued leave can be used in the first year. Employers may allow leave during probation.

Employees need the employer’s consent to take leave, and the employer can require leave on set days with at least seven days’ written notice. Under the 2024 Regulations at least five unused days can be carried forward, expiring 12 months later. Vacation keeps accruing during maternity leave. On termination, accrued untaken leave is paid at the daily wage, which for a five-day week is annual wage divided by 260.

Employees in the Dubai International Financial Centre (DIFC), Dubai’s financial free zone, receive at least 20 working days of paid vacation leave a year once they have been employed for 90 days, paid at their daily wage and in addition to public holidays. In the first year leave accrues at one-twelfth of the annual entitlement each month and only accrued leave can be taken.

Employees give at least seven days’ written notice of leave, and the employer can require leave on set days with the same notice. Employees may always carry at least five unused days into the next leave year, where they expire after 12 months. Leave cannot be exchanged for pay during employment; on termination, accrued untaken leave is paid at the daily wage.

Employees under the federal labour law are entitled to at least 30 days of paid annual leave for each year of service, on full wage. Employees with more than six months’ but less than a year’s service earn two days for each month worked, and employees who leave before using their balance are paid for the leave accrued in their final part-year. Leave may be granted during probation if the employer agrees.

The employer sets leave dates according to business needs in agreement with the employee and must give at least one month’s notice of the dates. Leave should be taken in the year it is earned; carry-over to the next year requires the employer’s approval under company rules, and an employer cannot prevent an employee from using leave accrued for more than two years unless the employee chooses to carry it over or be paid. Public holidays falling within annual leave count as part of the leave unless the contract or company policy is more generous. On termination, unused leave is paid out in cash, calculated on basic wage.

Employees in Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, are entitled to up to 60 working days of sick leave in any 12-month period. After probation the employer pays full daily wage for the first 10 days, half pay for the next 20 days, and the last 30 days are unpaid. Sick leave taken during probation is unpaid.

Employees must report sickness on the first day of absence and provide a medical certificate from a doctor registered in the country if the employer asks. An employer may end employment with immediate written notice once sick leave exceeds 60 working days in 12 months, unless the absence is due to a disability.

Employees in the Dubai International Financial Centre (DIFC), Dubai’s financial free zone, may take up to 60 working days of sick leave in any 12-month period. The employer pays 100% of daily wage for the first 10 working days, 50% for the next 20 working days, and the remainder is unpaid; employers may agree more generous terms.

The employee must notify the employer on the first day of absence and at least every three days after that, and provide a certificate from a registered doctor if asked. If an employee takes more than 60 working days in 12 months, the employer may end the contract immediately on written notice, except where the absence relates to a disability.

After completing probation, an employee under the federal labour law may take up to 90 days of sick leave a year, continuous or intermittent. The first 15 days are paid at full wage, the next 30 days at half wage and the remaining 45 days are unpaid. During probation there is no paid sick leave, although the employer may grant unpaid sick leave on a medical report.

The employee must tell the employer within three working days of falling ill and provide a medical report from a licensed health facility. No sick pay is due where the illness results from the employee’s own misconduct. An employer may not dismiss an employee for ill health before they have used their accrued leave; once the full sick leave is exhausted and the employee still cannot return, the employer may end the contract and pay all end-of-service entitlements.

Employees in Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, are entitled to five working days of paid bereavement leave on the death of a spouse, parent, child (including an adopted child) or sibling. The entitlement applies to each bereavement, must be used within one month, and the employer may ask for reasonable evidence. The Dubai International Financial Centre’s employment law contains no equivalent statutory bereavement leave.

Employees under the federal labour law receive paid bereavement leave starting from the date of death: five days on the death of a husband or wife, and three days on the death of a mother, father, son, daughter, brother, sister, grandchild or grandparent. Proof of the death is required on return, and bereavement leave can be combined with annual or unpaid leave.

The federal labour law gives private-sector employees no automatic right to Hajj leave. Under government guidance, employers may grant special unpaid leave of up to 30 days to perform the Hajj pilgrimage once during employment with the company. There is no statutory leave for Umrah, the shorter pilgrimage; with the employer’s consent it can be taken from annual leave or as unpaid leave.

The two financial free zones grant a statutory right to unpaid Hajj leave once during employment for Muslim employees with at least one year of continuous service. In the Dubai International Financial Centre (DIFC) the leave can last up to 21 days; in Abu Dhabi Global Market (ADGM) up to 30 calendar days. The employer is not required to pay salary for the period.

Emirati employees in the private sector are entitled to a paid sabbatical leave while performing compulsory national military service, under Article 32 of the federal labour law, with the detailed terms set by national service legislation. The employee must provide proof of call-up from the competent authority. The entitlement applies only to United Arab Emirates (UAE) nationals; expatriate employees are not affected.

The federal legal minimum of 30 days’ annual leave is already generous by international standards. Some employers offer more, for example extra days for seniority or long service, or packages of up to around 40 days. In the financial free zones the legal minimum is 20 working days, so contractual entitlements there start from a lower floor. Extra leave is a contractual benefit, and the employer’s policy sets how it accrues and whether it can be carried over.

Female employees in Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, are entitled to 65 working days of maternity leave. The right also covers adoption of a child under five and stillbirth or miscarriage after the 24th week of pregnancy. Maternity pay is 100% of daily wage for the first 33 working days and 50% for the next 32, for employees with at least 12 months’ continuous service before the expected week of birth who notify the employer at least eight weeks before that week, provide a medical certificate if asked and give 21 days’ notice of the start date.

Public holidays falling on working days extend the leave, vacation keeps accruing, and the employee may return to the same or a suitable alternative role. Nursing breaks of at least one hour a day continue for nine months after the birth.

Female employees in the Dubai International Financial Centre (DIFC), Dubai’s financial free zone, may take up to 65 working days of maternity leave, also available when adopting a child under five. Maternity pay is 100% of daily wage for the first 33 working days and 50% for the next 32 working days, for employees with at least 12 months’ continuous service before the expected week of birth who notify the employer of the pregnancy at least eight weeks before that week, provide a doctor’s certificate and give 21 days’ notice of the start date.

Public holidays falling on working days extend the leave, vacation keeps accruing, and untaken maternity leave cannot be paid out. On return, mothers working more than six hours a day are entitled to nursing breaks of at least one hour a day for six months after the birth.

Female employees under the federal labour law are entitled to 60 days of maternity leave: the first 45 days on full wage and the next 15 days on half wage, paid by the employer. The 2021 law sets no minimum length of service. Leave can start, at the employee’s request, from the last day of the month before the month in which birth is expected, supported by a medical certificate. Full leave also applies to a stillbirth, or to a baby who dies after birth, where delivery took place six months or more into the pregnancy.

After maternity leave, a mother who cannot return because she or her baby is ill from the pregnancy or birth may take up to 45 further days unpaid, continuous or intermittent, with a medical certificate. If the child is sick or has a disability requiring constant care, she is entitled to 30 more days on full pay, extendable by 30 days unpaid. For six months after the birth she may take one or two nursing breaks a day totalling up to one hour. Dismissal or notice because of pregnancy or maternity leave is prohibited. She also qualifies for the five-day parental leave available to either parent.

Fathers employed in Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, are entitled to five working days of paternity leave, taken within two months of a birth or of adopting a child under five. It is paid at the full daily wage if the employee has 12 months’ continuous service before the week of birth or adoption. Public holidays falling in the leave extend it, and unused leave cannot be exchanged for pay. Reasonable paid time off for antenatal appointments is also available to employees whose wife is pregnant.

Male employees in the Dubai International Financial Centre (DIFC), Dubai’s financial free zone, may take up to five working days of paternity leave on full daily wage within one month of their child’s birth or adoption of a child under five. They qualify with 12 months’ continuous service before the expected week of birth and by notifying the employer of the pregnancy at least eight weeks beforehand. Public holidays extend the leave, vacation continues to accrue, and unused paternity leave is not paid out.

Every private-sector employee under the federal labour law, mother or father, is entitled to five working days of paid parental leave to care for a newborn child. The leave can be taken in one block or in separate days at any time within six months of the birth, on full pay. The employee must provide proof, normally the child’s birth certificate. For mothers it comes on top of 60 days’ maternity leave. The federal law has no separate paternity leave, so this is the main statutory leave for new fathers; it can be combined with annual and unpaid leave.

Because expatriate children generally attend private, fee-paying schools, school fee support is a significant benefit for internationally hired staff. In Mercer’s 2025 Middle East Housing and Schooling Report, nearly nine in ten participating employers provided schooling coverage. Most (64%) differentiate it by seniority or role, while 36% apply the same benefit to all eligible staff, and 19% updated their education support in 2025, mainly to stay competitive and keep up with rising fees.

Support takes the form of a fixed annual allowance per child, a percentage of fees or direct payment of fees up to a cap. Employer guides cite allowances of around AED 10,000 per child a year. Guides describe it as especially common for senior and expatriate staff, notably in Abu Dhabi.

Employers in the United Arab Emirates have no legal obligation to pay a 13th-month salary, year-end bonus or holiday allowance. The federal labour law, and the employment laws of the Dubai International Financial Centre and Abu Dhabi Global Market, set no mandatory bonus. Any bonus becomes enforceable only when the employment contract or company policy promises it, and the law treats contractual cash allowances and benefits as part of the employee’s wage.

Annual bonuses are widespread among employers in the United Arab Emirates. In the Cooper Fitch Bonus Report 2026, 77% of firms planned to pay bonuses in 2026 for 2025 performance, up from 72% a year earlier. Among all respondents, 36% expected to pay one to two months’ basic salary, 26% three to five months and 7% six months or more; banking, financial services and insurance had the largest share paying six months or more (13%), while marketing, media and retail firms were most likely to pay nothing.

Bonuses are usually discretionary and linked to company and individual performance, and are expressed as months of basic salary. A bonus becomes a legal entitlement only when the contract or a regular, written practice promises it. Some employers pay a guaranteed 13th-month salary instead, but no law requires one.

Some startups and growth companies, particularly in technology, offer employee share or option plans to attract and retain talent. Employees receive options to buy shares at a set price, or shares themselves, earned over a vesting period; a common design is a one-year cliff, after which 25% vests, with the rest vesting monthly or quarterly over the following three years. Early-stage companies often reserve 10–15% of fully diluted equity for the pool.

Corporate form shapes what is possible. Private joint stock companies can issue incentive shares under the Commercial Companies Law with shareholder approval, capped at 10% of capital. Mainland limited liability companies, the most common startup form, face a 50-shareholder limit and pre-emption rights, which is why advisers often recommend cash-settled alternatives. Companies registered in the Dubai International Financial Centre (DIFC) or Abu Dhabi Global Market (ADGM) operate under common-law company rules that accommodate option pools, often held through a trust or nominee. With no personal income tax, employees face no local tax on gains, though home-country tax may apply.

Phantom shares give employees a cash payment linked to the value of company shares without transferring ownership: no shares are issued, and the employee has no voting or shareholder rights. A share appreciation right pays only the increase in value between grant and settlement. These cash-settled plans are a practical route for mainland limited liability companies, whose shareholder limits and pre-emption rules make issuing real equity to staff difficult. Payment is usually triggered by vesting combined with an exit, sale or valuation event, and the plan rules set what happens when an employee leaves. Because payouts are cash compensation, the employer funds them directly, and there is no personal income tax on them.

Federal law recognises full-time, part-time, temporary and flexible work patterns, and the implementing regulation adds remote work and job-sharing, each documented in a ministry contract form. An employee may work remotely, inside or outside the country, with the employer’s approval, and the employer can set required working hours. Part-time employees may work for more than one employer with the appropriate permit. There is no statutory right to request flexible or remote work: arrangements depend on agreement with the employer.

In Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, the regulations cover fully remote and hybrid employees and require the employer to supply and maintain the equipment needed for remote work unless agreed otherwise.

Employers in Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, must provide a one-way flight to the employee’s country of origin, or another agreed country, within 30 days of termination, either by booking it or reimbursing the employee. No flight is due if the employee is a remote employee based abroad, obtains new employment or visa sponsorship in the country within 30 days of the work permit being cancelled, or was dismissed for cause.

The federal labour law requires employers either to provide employees with suitable accommodation licensed by the authorities, or to pay a cash accommodation allowance, or to include housing in the wage. Employers can meet the duty through an all-inclusive salary, so the law does not fix a separate allowance amount. Employees living in employer accommodation must vacate it within 30 days of their employment ending, unless the employer agrees to a longer stay.

When employment ends, the employer must pay the cost of returning an expatriate employee to their place of recruitment or another agreed destination, unless the employee has already joined another employer or the termination was caused by the employee, in which case the employee bears the cost. If an employee dies, the employer pays for preparing and transporting the body to the home country or place of residence at the family’s request, and must hand over wages, gratuity and other dues to the family within 10 days. The employer also cancels the work permit and may not withhold the employee’s official documents.

A monthly transport allowance is a standard component of salary packages in the United Arab Emirates (UAE), paid in cash alongside basic salary and housing allowance to cover commuting and car costs. Employer guides report typical amounts of about AED 1,000 to AED 3,000 a month; some employers provide a company car, fuel card or staff transport instead. The allowance is part of the employee’s total wage, so it counts for notice pay, but not for end-of-service gratuity, which is based on basic salary only.

An annual return flight to the home country, or a cash ticket allowance, is a well-established benefit for expatriate employees. In HSBC’s Expat Explorer survey published in 2019, three-quarters of expatriates in the United Arab Emirates said they received an annual airfare allowance. Employers usually pay an economy-class return ticket once a year, which employer guides value at about AED 1,500 to AED 4,000 depending on destination, and some packages extend tickets to the spouse and children. It is separate from the statutory repatriation flight owed at the end of employment.

Housing support is a core element of pay in the United Arab Emirates. In Mercer’s 2025 Middle East Housing and Schooling Report, about 70% of participating employers paid a separate housing allowance and about 25% built housing into a consolidated salary; 52% paid the allowance upfront rather than monthly, and allowances rose by an average of 4% between 2024 and 2025. Employer guides put typical housing allowances at about 20% to 40% of basic salary. Some employers provide company accommodation instead.

The federal labour law requires employers to provide accommodation, a housing allowance or a salary that includes housing. A separate allowance counts as wage for notice pay but not towards end-of-service gratuity, which is calculated on basic salary only.

Some employers pay a food or meal allowance, usually as a fixed monthly cash amount within the salary package, and some provide meals at work. Allowance amounts are set by each employer and, like other allowances, do not count towards end-of-service gratuity, which is calculated on basic salary.

Some employers pay a monthly mobile phone allowance or provide a company phone plan, and some reimburse home internet and phone costs for employees who work remotely. Guides cite phone allowances of about AED 200 a month. Amounts and eligibility are set by employer policy.

Flexible schedules and hybrid working reach a minority of employees. In Mercer Marsh Benefits’ 2025 Health on Demand survey, half of employees in the United Arab Emirates (UAE) said flexible schedules such as compressed weeks would help them, but only 33% received them. In Michael Page’s Talent Trends 2025, 34% of UAE professionals worked hybrid, and 53% said they would consider leaving if asked to spend more time in the office.

The law allows remote, flexible and part-time patterns by agreement but gives no right to request them, so arrangements rest on company policy. In technology, remote-work stipends are becoming more common, and employers in Abu Dhabi Global Market must provide equipment to remote employees.

Some employers support employee learning beyond the training they must provide by law, through study allowances, tuition sponsorship for degrees and professional qualifications, or paid time for courses and exams. Guides cite study allowances of around AED 10,000 a year. Separately, the federal labour law requires employers to invest in employees’ skills and allows up to 10 working days of study leave for exams after two years’ service.

Employers hiring from abroad may pay relocation costs such as flights, shipping and temporary accommodation, sometimes as a lump-sum allowance. The employer must pay the employee’s own work permit and residence visa, but family members are sponsored by the employee unless the employer agrees to cover them; some employers pay dependant visa, medical test and Emirates ID costs as a benefit. The scope of relocation support, repayment terms if the employee leaves early and whether family costs are included are set by the offer letter or policy.

Under the federal labour law, a worker is a person authorised by the labour ministry to work for a licensed employer under its supervision and direction, in return for a wage. Nobody may work, and no employer may employ anyone, without a work permit from the Ministry of Human Resources and Emiratisation (MoHRE). Independent work is a recognised arrangement: a freelancer holds a freelance work permit or a licence from a free zone or emirate economic department, sponsors their own residence, and provides services to several clients without an employer or employment contract.

Whether someone is a freelancer or an employee depends on the facts: a company-sponsored visa, an employment contract, integration into the business and the client’s control over the work point to employment. Treating an employee as a contractor exposes the business to claims for gratuity, leave and other dues, and employing a person not authorised to work for it is fined AED 100,000 to AED 1,000,000 under the 2024 amendment, multiplied by the number of workers affected. Domestic workers and government employees fall under separate laws.

Every private-sector employee must have a written contract on the standard forms of the Ministry of Human Resources and Emiratisation (MoHRE), the federal labour ministry, registered with the ministry and made in two copies, one for each party. All contracts are fixed-term. The original three-year maximum in the 2021 law was removed by an amendment in 2022, so the parties can agree any term and renew or extend it; if both continue working after expiry without a new agreement, the contract is treated as extended on the same terms. Unlimited contracts under the old law had to be converted to fixed-term contracts.

Contracts can follow several work patterns: full-time, part-time, temporary, flexible, remote and job-sharing. The law prohibits discrimination on grounds including race, sex, religion, nationality and disability, requires equal pay for women doing work of equal value, and bans harassment and forced labour. Employers may not charge employees recruitment fees or keep their passports. A non-compete clause is valid only where reasonable in time, place and type of work, and for no more than two years after the contract ends.

In the Dubai International Financial Centre (DIFC) the employer must give a written employment contract in English within seven days of the start of employment, stating at least the parties, start date, wage, pay period, hours and days of work, leave, notice and any probation. In Abu Dhabi Global Market (ADGM) the contract must be in English and signed by both parties within one month of the start date. Both regimes allow fixed-term and open-ended contracts and require the employer to obtain and pay for work permits, residence visas and Emirates ID cards.

The federal Wage Protection System does not apply in Abu Dhabi Global Market (ADGM), and the Dubai International Financial Centre (DIFC) sets its own payment rules. In DIFC, all remuneration earned in a pay period must be paid within seven days after the period ends. In ADGM a pay period cannot exceed one month and wages are due within 14 calendar days of the end of each period. Both require an itemised pay statement showing the amount paid and any deductions. Bonuses and other variable payments can be deferred or made conditional by written agreement.

There is no general minimum wage for private-sector employees in the United Arab Emirates (UAE). The federal labour law allows the Cabinet to set one for all workers or particular groups, but none has been set for expatriates, whose pay is fixed by contract.

Emirati employees are the exception. From 1 January 2026 the Ministry of Human Resources and Emiratisation (MoHRE) requires a minimum salary of AED 6,000 a month for Emiratis in the private sector, up from AED 5,000. It applies to new work permits and to permits renewed or amended from that date, and employers had until 30 June 2026 to raise existing Emirati salaries. From 1 July 2026 Emiratis paid less do not count towards the company’s Emiratisation hiring targets, and non-compliant companies cannot obtain new work permits until salaries are corrected.

Normal working time under the federal labour law is at most 8 hours a day or 48 hours a week, and no one may work more than 5 consecutive hours without breaks totalling at least one hour. Employers may require up to 2 hours of overtime a day, provided total working time does not exceed 144 hours over any three weeks. Overtime is paid at basic hourly wage plus at least 25%, rising to at least 50% for overtime worked between 10pm and 4am (shift workers excepted). An employee who works on the weekly rest day receives another day off or that day’s pay plus at least 50% of basic wage, and cannot be asked to work more than two consecutive rest days. Public holiday work is compensated the same way.

Every employee gets at least one paid rest day a week. Private employers choose their working week: the 2022 move of government offices to a Saturday–Sunday weekend did not bind the private sector. During Ramadan, normal hours are reduced by 2 hours a day for private-sector staff, and hours worked beyond the reduced limit count as overtime. Board members, supervisors with employer powers and some shift and maritime workers are excluded from the hours and overtime rules.

The Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM), the two financial free zones with their own employment laws, cap working time at an average of 48 hours a week unless the employee agrees in writing. Employees are entitled to 11 consecutive hours’ rest in every 24 hours, an uninterrupted 24-hour rest period each week, and at least one hour of breaks on days longer than six hours. Neither law sets a fixed overtime premium: overtime pay depends on the contract, although ADGM guidance says employees may be entitled to payment for hours beyond the weekly maximum, with managerial and supervisory roles exempt.

During Ramadan, Muslim employees in DIFC may not be required to work more than six hours a day, and in ADGM their hours fall by 25%, in both cases without loss of pay. Employers in ADGM may extend the reduction to all staff.

An employer may set a probation period of up to six months, and only once with the same employer; probation counts towards length of service. During probation the employer may end the contract with at least 14 days’ written notice. An employee who resigns during probation to join another employer in the country must give at least one month’s written notice, and the new employer must reimburse the original employer’s recruitment costs unless agreed otherwise. An expatriate who resigns to leave the country must give 14 days’ notice; if they return on a new work permit within three months, the new employer pays the same compensation.

A party that ends employment without the required notice owes the other the wages for the notice period. An expatriate who leaves without following these rules can be barred from a new work permit for one year. Employees on probation receive no paid sick leave, and annual leave during probation is at the employer’s discretion.

In the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM), probation may last up to six months, or no more than half the contract term for contracts of six months or less. Probation is optional and counts towards service for gratuity and leave payouts. In ADGM either party can end employment during probation on one week’s written notice, or without notice for cause. In DIFC the statutory minimum notice periods do not apply during probation, so the contract sets the notice. Sick leave taken during probation is unpaid.

Either party may end an employment contract for a legitimate reason by giving written notice of at least 30 and no more than 90 days, as agreed in the contract; the period must be the same for both sides unless a longer employer notice favours the employee. The contract continues on full pay during notice, and the parties can agree to waive or shorten it while preserving the employee’s notice pay. The party that fails to give notice pays wages for the full or remaining period. When the employer gives notice, the employee may take one unpaid day a week to look for work. Notice served during leave starts only after the employee returns. Contracts also end by mutual agreement, at the end of their term or on closure or insolvency of the business; there is no dismissal at will.

The employer may dismiss without notice only after a written investigation and only on ten grounds in the law, such as forged documents, serious safety breaches, repeated failure to perform after two written warnings, intoxication at work, assault or unauthorised absence of more than 20 days a year or 7 consecutive days. Dismissal for filing a genuine complaint or lawsuit is unlawful and attracts court-assessed compensation of up to three months’ wages, on top of notice pay and gratuity. Dismissal because of pregnancy or maternity leave is prohibited. All wages, gratuity, accrued leave and other dues must be paid within 14 days of the contract ending. Claims must be filed within two years, starting with the labour ministry, which decides claims up to AED 50,000 itself.

In Abu Dhabi Global Market (ADGM), Abu Dhabi’s financial free zone, the minimum written notice once employment has lasted a month is 7 days for service under three months and 30 days from three months, unless the contract sets longer. Payment in lieu of notice requires the employee’s written consent, and employees are entitled to a written statement of the reasons for dismissal. Notice does not apply to dismissal for cause, termination for excessive sick leave or a fixed-term contract without a notice clause.

All wages and other amounts due, including gratuity but excluding genuinely variable pay, must be paid within 21 calendar days of termination. Late payment triggers a penalty of one day’s wage for each day in arrears, capped at six months’ wages, where more than a week’s wages are outstanding. The employer must also cancel the work permit and residence visa at its own cost and may not make cancellation conditional on the employee waiving rights.

In the Dubai International Financial Centre (DIFC), Dubai’s financial free zone, either side may end employment without cause on written notice of at least 7 days in the first three months, 30 days from three months to five years, and 90 days after five years, unless the contract sets longer. Statutory notice does not apply during probation, at the end of an agreed fixed term or on termination for excessive sick leave. The employer may pay in lieu of notice only for cause or by agreement, and may place the employee on garden leave.

Within 14 days of termination the employer must pay all remuneration, any accrued legacy gratuity, a daily wage for each untaken vacation day and outstanding savings-scheme contributions. If it pays late, a court can award a penalty of one day’s wage for each day of delay where the unpaid amount exceeds a week’s wage.

Emiratisation is the federal policy requiring private companies to hire Emirati citizens into skilled roles. Companies with 50 or more employees must raise the share of Emiratis in skilled jobs by 2 percentage points a year, measured as 1 point each half-year, reaching a cumulative 10% by the end of 2026. Companies that missed the first-half 2026 target face a financial contribution from 1 July 2026 of AED 10,000 a month (AED 120,000 a year) for each position not filled by an Emirati, collected through the Ministry of Human Resources and Emiratisation (MoHRE).

Companies with 20 to 49 employees in 14 sectors, including information and communications, financial services, real estate, professional and technical services, education, healthcare, construction and hospitality, had to employ at least one Emirati in 2024 and two in 2025, with contributions of AED 96,000 and AED 108,000 respectively for each shortfall. Fake Emiratisation, such as nominal hires, carries fines of AED 100,000 to AED 500,000. Only Emiratis paid at least the AED 6,000 private-sector minimum salary count towards targets from 1 July 2026.

The United Arab Emirates has no payroll tax and no employer social security contribution for expatriate employees. The statutory cost of an expatriate employee consists of mandatory health insurance, accrual of end-of-service gratuity (21 days’ basic wage per year for the first five years), work permit and residence visa costs, which the employer must bear and cannot recover from the employee, and repatriation on termination. Work permit issue or renewal fees range from AED 250 to AED 3,450 depending on the company’s ministry classification. Employees pay their own unemployment insurance premium of AED 5 or AED 10 a month.

For Emirati employees, employers add pension contributions of 15% of contribution salary (12.5% net where the salary is below AED 20,000) to the General Pension and Social Security Authority (GPSSA), the federal pension fund, or the Abu Dhabi Pension Fund. Mainland employers that miss Emiratisation targets – quotas for hiring Emirati citizens – also pay a monthly financial contribution for each unfilled position.

The United Arab Emirates (UAE) levies no personal income tax, so salary, allowances, bonuses, benefits in kind and end-of-service gratuity are received free of income tax and there is no payroll withholding for expatriates. Employment income is outside the scope of corporate tax, which applies to businesses, and to individuals only when they carry on a business. Emirati employees pay their pension contribution, and every employee pays the small unemployment insurance premium. Employers pay federal corporate tax of 9% on taxable profits above AED 375,000, for financial years starting on or after 1 June 2023.

Most private employers, on the mainland and in free zones such as the Jebel Ali Free Zone and Dubai Multi Commodities Centre, follow the federal labour law, Federal Decree-Law No. 33 of 2021, with its implementing regulation (Cabinet Resolution No. 1 of 2022). The two financial free zones have their own common-law-based employment laws and courts: the Dubai International Financial Centre (DIFC) Employment Law No. 2 of 2019, last consolidated in July 2025, and the Abu Dhabi Global Market (ADGM) Employment Regulations 2024, in force since 1 April 2025. They differ from federal law on leave, gratuity, notice and dispute resolution. Government employees and domestic workers are covered by separate laws.

Federal law provides no collective bargaining framework: disputes between an employer and a group of workers go to the labour ministry and, if unresolved, to a collective labour disputes committee. Terms are set individually in contracts and company work regulations, which employers with more than 50 employees must issue.

Expatriates may work only with a work permit and, unless sponsored by family, an employer-sponsored residence visa and Emirates ID card. Mainland permits are issued by the Ministry of Human Resources and Emiratisation (MoHRE) in 12 types, including recruitment from abroad, transfer between employers, part-time, temporary, one-mission, freelance, Golden Visa holder and permits for Emirati and other Gulf nationals. The employer pays permit fees of AED 250 to AED 3,450 depending on its ministry classification, plus visa, medical test and Emirates ID costs, and may not recover them from the employee. Residence visas require a medical test and, in every emirate, valid health insurance before issue or renewal.

Long-term residence routes that do not depend on an employer include the Golden Visa (five or ten years) and the five-year Green Visa for skilled employees and freelancers. Employers in the Dubai International Financial Centre and Abu Dhabi Global Market obtain permits through their own free-zone authorities.

Pay in the United Arab Emirates (UAE) is usually split into basic salary plus cash allowances, most often for housing and transport and sometimes for phone, education or other costs. The split matters because the federal labour law calculates end-of-service gratuity, overtime and leave encashment on basic salary, while notice pay and many other entitlements use the full wage. Employer guides report that basic salary typically makes up about 40% to 60% of total monthly pay. The Dubai International Financial Centre and Abu Dhabi Global Market treat basic salary as at least 50% of total wages when calculating gratuity, to stop employers shrinking it through allowances. A lower basic share reduces gratuity and overtime costs for the employer.