Key Updates to the UAE Labour Law: 2024 Amendments and Their Impact
Introduction: A Progressive Step in Employment Regulation
The United Arab Emirates continues to evolve its labour market through legislative reforms that balance economic growth with worker protections. In 2024, Federal Decree-Law No. 9 of 2024 introduced significant amendments to the UAE Labour Law, affecting both employers and employees. These reforms enhance dispute resolution mechanisms, impose stronger penalties for violations, and reinforce the UAE’s national employment (Emiratisation) goals.
In this article, FS Legal Services outlines the five major changes introduced by the amendment and explains how they affect companies operating in the UAE.
1. New Mechanism for Labour Dispute Resolution
Under the new system, the Ministry of Human Resources and Emiratisation (MoHRE) has been granted expanded powers to mediate and adjudicate employment disputes:
- All labour disputes must first be submitted to MoHRE for mediation.
- If the dispute involves claims under AED 50,000, MoHRE may now issue a binding administrative decision.
- Either party may appeal MoHRE’s decision by filing a case before the Court of First Instance within 30 working days.
- This process replaces the previous path, where certain disputes could be escalated directly to the Appeals Court.
Impact:
The system now offers a faster, more efficient dispute resolution path for lower-value claims, reducing the burden on courts and enabling quicker resolution for workers.
2. Increased Penalties for Labour Law Violations
To ensure compliance and protect worker rights, the 2024 amendment imposes higher penalties for companies engaging in illegal or unethical employment practices. Fines now range from AED 100,000 to AED 1 million for offenses such as:
- Employing individuals without valid work permits
- Sponsoring workers without offering employment
- Misusing work permits for unintended activities
- Failing to settle employee entitlements upon business closure
- Engaging in fraudulent employment practices (e.g., false Emiratisation hires)
In cases involving fake Emiratisation hires:
- Penalties escalate based on the number of fraudulent hires
- All government benefits gained through deception must be repaid
- MoHRE may initiate criminal proceedings
Impact:
These provisions crack down on abuses of the labour system and reinforce ethical business operations, particularly around national hiring programs.
3. Enhanced Protections for Employees
To prevent prolonged wage disputes from harming workers, the amendment empowers MoHRE to:
- Order salary payments for up to two months if an unresolved dispute affects the employee’s pay
- Extend the statute of limitations for labour claims to two years from the termination date, up from the previous shorter period
Impact:
This change protects employees during unresolved disputes and ensures they are not unfairly penalised for delayed legal actions.
4. Reinforcement of Emiratisation Commitments
Emiratisation — the policy of integrating UAE nationals into the private sector — remains a strategic national objective. The new amendment reinforces these commitments by:
- Imposing steeper penalties for companies that falsely claim to have hired Emiratis
- Requiring stricter audits and compliance checks from MoHRE
- Returning government incentives from non-compliant employers
- Targeting fictitious employment arrangements used to benefit from quotas or subsidies
Impact:
The UAE is sending a strong message: Emiratisation is a serious legal obligation, not a formality. Employers must implement transparent and genuine hiring practices for UAE nationals.
5. Legal and Strategic Implications for Employers
The 2024 amendments collectively aim to build:
- A faster dispute resolution system
- A more ethical labour market
- A stronger compliance culture among employers
Employers must now:
- Verify the validity of every employee’s work permit
- Maintain accurate HR records and contracts
- Avoid employing or sponsoring workers without valid intent
- Ensure transparent reporting when closing or suspending business operations
- Align hiring policies with authentic Emiratisation commitments
Impact:
Non-compliance now carries heavier financial, reputational, and legal risks — especially for companies with large workforces or complex employment structures.
Conclusion: Navigating the New Labour Law with FS Legal Services
The UAE Labour Law amendments of 2024 reflect a broader policy of legal clarity, employee protection, and fair labour enforcement. Whether you’re a multinational or SME, these legal updates demand careful review of your HR practices and internal policies.
At FS Legal Services, we offer:
- Tailored compliance reviews for employers
- Labour dispute resolution support
- Legal representation in MoHRE and court processes
- Advice on Emiratisation obligations
- Workforce structuring and employment contract guidance
Need to review your HR compliance or prepare for MoHRE audits?
Our team is here to support you through every step.
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FS Legal Services
Your Legal Partner for Labour Compliance in the UAE