Due to the country’s extreme dedication to education and training, the UAE workforce is a melting pot full of adept professionals ready to do their best work. Bringing professionals from the UAE onto your employee roster could be fantastic for your business’s growth trajectory. Still, it’s essential not to do things haphazardly.

The UAE is very particular when it comes to how their workers are treated by both domestic and foreign businesses. If you want to reel in the best and brightest talent, it’s important to learn about the labor law in the UAE and build a stellar employee benefits package – one that meets legal regulations and gives candidates what they’re looking for from an employer.

In this guide, we’ll share everything you need to know about employee benefits in the United Arab Emirates. We’ll cover mandatory and supplementary employee benefits, as well as some helpful tips and resources that’ll come in handy as you’re piecing your benefits package together.

Where to Find the Labor Law of the UAE

Employee benefits in the United Arab Emirates all stem from the UAE Labor Law. The law outlines the employer/employee relationship, including working hours, overtime, and some of the main benefits employers should be providing.

Mandatory Employee Benefits in the United Arab Emirates

When you hire an employee from the United Arab Emirates, there are several mandatory benefits employers are legally obligated to provide. We’ll touch on each of them in the sections below:

Working Hours

As an employer of UAE workers, you have to abide by working hour maximums of 8 hours per day and 48 hours per week. Workers in certain sectors may have more relaxed working hour requirements. Hours may also be reduced for Ramadan. You can read more about working hours in Article (17) of the UAE Labor Law.

You can read more about working hours in Article (17) of the UAE Labor Law.

Overtime Compensation

Employers can ask an employee to work up to two hours over the 8-hour-per-day hour limit. Regular working hours plus overtime should never surpass 144 hours every 3 weeks. Employers are expected to pay more than the employee’s regular wage for overtime depending on when the extended shift takes place. See the table below for that information:

Overtime Conditions Compensation
During normal working hours 25% more than basic wage
Between 10 pm and 4 am 50% more than basic wage
On weekends Another day off or 50% more than the basic wage

Annual Leave

UAE workers are entitled to an annual leave of 30 days after having worked for a company for at least a year. If an employee has only been working for at least 6 months but less than 12 months, they get 2 days of annual leave for every month they’ve worked for the company.

Read more about annual leave and other leaves in Articles (29) and (32) of the UAE Labor Law.

Public Holidays

Workers in the UAE get the following public holidays off with full pay:

  • New Year’s Day: 1 January
  • Eid Al Fitr: From 29 Ramadan to 3 Shawwal 1445 AH (4 days)
  • Arafah day and Eid Al Adha (Feast of Sacrifice): From 9 to 12 Dhu al Hijjah 1445 AH (4 days)
  • Hijri New Year (Islamic New Year): 1 Muharram 1446 AH
  • Prophet Mohammed’s birthday: 12 Rabi’ Awwal 1446 AH
  • National Day: 2 and 3 December (2 days).

If you need your employee to work on a public holiday, you’ll need to do one of the following to set things right with the law:

  • Give the employee another day off.
  • Pay the employee their full wage plus 50%.

You can find this information in the UAE Labor Law in Article (28).

Sick Leave

When an employee becomes sick (and it isn’t related to a work-related injury or infection) and it’s past their probationary period, they get a maximum of 90 days of sick leave. Here’s how these days are to be paid according to the law:

Sick Leave Period Compensation
First 15 days Full pay
15th to 45th day Half pay
45th to 90th day Unpaid

The employer may wish to grant the employee sick leave before the probation period is complete – you’re not required to pay the employee for this leave.

Maternity Leave

Female employees who are pregnant are entitled to a 60-day maternity leave. The first 45 days of the leave will be paid at 100% of their regular wage. And for the last 15 days, the employee will be paid 50% of their wage. There are other specifications you should be aware of as an employer.

End-of-Service Gratuity

According to the law in the UAE, full-time workers are entitled to end-of-service benefits after working for a single employer for at least one continuous year. They get 21 days’ basic wage for each of the first five years and 30 days’ basic wage for each additional year.

For more information about these UAE employee benefits, read the UAE Labor Law.

Health Insurance

As of the time of this writing, there’s no mandatory health insurance contribution requirement for private sector and domestic UAE employees (except for those in Abu Dhabi and Dubai). But that’s set to change in 2025. There will be a rule mandating medical insurance for every UAE resident.

Workplace Injury and Medical Expenses

If an employee is injured at their place of work, the employer is required to pay for the employee’s medical treatment and pay the worker’s full wage for the duration of the treatment or 6 months (whichever is less). After those 6 months, the employee is due half of their wage for up to 6 more months. 

Article (37) of the UAE Labor Law goes into more detail on this benefit.

Unemployment Insurance

There’s an unemployment insurance scheme for qualifying UAE employees who are terminated from their jobs. They are provided compensation of 60% of the contribution salary for three months. Both the employee and the employer contribute to this scheme. 

There are many rules regarding this benefit, so we recommend exploring the full law text – Federal Decree-Law No. 13 of 2022.

Supplementary Employee Benefits in the United Arab Emirates

The above UAE employee benefits are substantial enough to put a serious dent in your business’s budget, but it’s worthwhile to consider supplementary employee benefits. UAE employees will expect to receive the minimum benefits guaranteed by the law. And other employers will likely have them all included in their employee benefit plans.

If you want to stand out from competitors and make employees feel valued, consider offering one or more of the below supplementary benefits as well:

  • Health insurance with comprehensive coverage for medical, dental, mental health, wellness programs, and more.
  • Flexible working arrangements (hybrid and remote work options may be desirable). Others might prefer working hour flexibility over location freedom.
  • Leave allotments surpassing the legal requirements.
  • Additional savings plans or increased contributions on existing savings plans (so long as they align with the law).
  • Paid training to prime employees for advancement from within.
  • Relocation benefits and travel stipends.

How to Create the Perfect Benefit Plan for Employees From the UAE

Creating a benefit plan that’ll wow UAE job candidates requires intentional action. Here are some steps to follow for the best possible results:

  • Get a good understanding of the labor law in the UAE. First and foremost, learn all you can about the mandatory labor laws in place. Ensuring compliance is of the utmost importance for any employer working with UAE talent. Failing to comply with the law will lead to far-reaching penalties.
  • Determine what your employees need most in an employee benefits package. If you’re targeting UAE nationals, focusing on supplementary benefits relevant to everyday needs may be most impactful. On the other hand, if you’re targeting expatriates working in the UAE, travel-related benefits will make more of an impact. Our advice? Conduct in-depth research and use your best judgment.
  • Type up your benefit plan, with both the mandatory and supplementary benefits (as well as any other extra items). Package and distribute the benefit plan information. Turning it into a handbook and distributing it to promising candidates could be helpful.
  • Keep the employee benefits plan updated. Laws and regulations are always subject to change. Though there’s usually a grace period before employers have to attain full compliance, it’s wise to keep an eye on the laws and update the plan swiftly and carefully.

So, there you have it – everything you need to know about employee benefits in the UAE. We hope you found all the information and resources you were looking for, and we wish you the best as you explore the UAE workforce.