The Abu Dhabi Global Market (ADGM) is an independent financial free zone located on Al Maryah Island, operating under its own civil and commercial legal framework based on English common law — separate from both the UAE’s federal labour law and Dubai’s DIFC Employment Law. The Employment Regulations 2024 establish the minimum employment standards, rights, and obligations for employers and employees operating within the ADGM, and represent a comprehensive modernisation of the previous 2019 framework.
UAE Federal Decree-Law No. 47 of 2021 (the UAE federal labour law) does not apply to ADGM employers, and UAE federal Emiratisation requirements likewise do not apply within the ADGM. One notable exemption exists: employers holding a dual licence issued by the Abu Dhabi Department of Economic Development (ADDED), whose employees are governed by the UAE federal labour law, are exempt from the ADGM Employment Regulations 2024.
Key Provisions Relating to Individuals (Employees)
1. Termination on Notice (Article 56)
Either the employer or the employee may terminate employment at any time by giving written notice. The minimum statutory notice periods are:
- 7 calendar days — where the employee has less than 3 months of continuous service
- 30 calendar days — where the employee has completed 3 or more months of continuous service
Parties cannot contract for shorter notice periods, but may agree to longer ones — notice periods of 3 to 6 months are common for senior or executive employees. A minimum notice period of one week applies specifically during an employee’s probationary period.
2. Termination for Cause (Article 57)
Either party may terminate employment immediately, without notice, where the conduct of the other party is such that a reasonable employer or employee would regard summary termination as justified. This is a high legal threshold, and employers are advised to approach summary dismissal cautiously.
3. End-of-Service Gratuity (Sections 61–62)
This is one of the most significant areas of change introduced by the 2024 Regulations:
- Employees who complete 1 year or more of continuous employment are entitled to a gratuity payment on termination, calculated on the employee’s basic wage and length of service.
- The two-year salary cap has been removed. Under the 2019 Regulations, total gratuity was capped at the equivalent of two years’ wages; the 2024 Regulations remove this cap entirely, allowing for potentially higher gratuity payments for long-serving employees.
- The employee’s basic wage must not be less than 50% of total wages — a new safeguard designed to prevent employers from artificially minimising the basic wage used to calculate gratuity.
- Gratuity now remains payable even where an employee is dismissed for cause — a significant strengthening of employee protection compared to the previous regime, intended to function more like a guaranteed pension entitlement than a discretionary benefit.
- Where termination occurs before the end of a full year of employment, the gratuity is calculated on a proportionate (pro-rata) basis.
- The employer may deduct from the gratuity any amounts properly owed to the employer by the employee.
- As an alternative, an employer may offer the employee the option of participating in a pension or savings scheme in place of the standard end-of-service gratuity.
4. Repatriation Flight (Section 62)
Employers must provide employees with a one-way repatriation flight ticket at the end of employment (or cover the associated cost), including for remote employees who reside in and perform work within the UAE.
5. Remote Employees
The 2024 Regulations introduce a dedicated framework for “Remote Employees.” Employers may now hire full-time remote employees based outside the ADGM — a shift from the 2019 Regulations, which required an employee to hold an ADGM work permit and be based within or ordinarily working from the ADGM. Remote employees who do not reside and work in the UAE do not require a UAE residence visa or ADGM work permit. Unless otherwise agreed, employers must provide and maintain the technical equipment necessary for remote employees to carry out their work.
6. Certificate of Experience
Employees have the right to request a certificate of experience from their employer, setting out the employer’s name, the employee’s name, the term of employment, the last position held, and the employee’s salary as at their leaving date. If the employer fails to provide this within 14 days of the request, or provides an inaccurate certificate, the employer becomes liable to pay the employee the equivalent of one month’s wages.
7. Protected Characteristics and Anti-Retaliation
Pregnancy and maternity have been introduced as protected characteristics under the 2024 Regulations, while colour has been removed as a standalone protected characteristic. The Regulations also contain robust anti-retaliation provisions: employers and related parties must not retaliate — or threaten to retaliate — against an employee for making, or intending to make, a protected disclosure. Retaliation is broadly defined and includes denying equal terms, benefits, training, promotion, or transfer opportunities, and any other action reasonably likely to cause detriment.
8. Visa-Related Costs
Employers are prohibited from charging employees for visa-related costs, including visa cancellation fees.
9. Overtime
Overtime provisions have been removed from the 2024 Regulations. Entitlement to, and calculation of, overtime pay is now left to be agreed directly between employer and employee.
Key Provisions Relating to Employers and Businesses
- No Waiver of Minimum Standards: The Regulations are expressly stated to establish minimum standards which cannot be waived or excluded in any agreement, except where expressly permitted by the Regulations themselves.
- GCC National Pension Enrolment: Employers must enrol eligible UAE/GCC national employees in the applicable state pension scheme within 30 calendar days of the commencement of their employment.
- Probationary Period Leave: An employee may only take annual leave during their probationary period with the employer’s approval.
- Dual-Licence Exemption: Employers holding a dual ADDED/ADGM licence, whose employees are governed by the UAE federal labour law, are exempt from the ADGM Employment Regulations 2024.
- Fines and Sanctions: Employers who breach the Employment Regulations are subject to fines and other sanctions under the ADGM Standard Fines Scale, referenced in the ADGM Commercial Licensing Regulations 2015 (Fines) Rules 2020.
- Transition from the 2019 Regulations: Employers should proactively review and update their employment contracts, policies, and payroll practices to ensure alignment with the 2024 Regulations, particularly regarding gratuity calculation, remote work arrangements, and anti-retaliation obligations.
Frequently Asked Questions
Does UAE Federal Labour Law apply to ADGM employees? No. UAE Federal Decree-Law No. 47 of 2021 does not apply to ADGM employers or employees (except in the case of a dual ADDED/ADGM licence). ADGM operates its own independent employment framework.
Is there still a cap on end-of-service gratuity in the ADGM? No. The 2024 Regulations removed the two-year salary cap that applied under the 2019 Regulations, meaning long-serving employees may now be entitled to significantly higher gratuity payments.
Do I still receive gratuity if I’m dismissed for cause? Yes. Under the 2024 Regulations, gratuity remains payable even where an employee is summarily dismissed for cause — a notable strengthening of employee protection compared to the 2019 framework.
Can I work for an ADGM employer remotely from outside the UAE? Yes, under the new “Remote Employee” framework introduced in 2024. If you do not reside and work in the UAE, you do not require a UAE residence visa or ADGM work permit.
What notice period applies if I’m dismissed? Under Article 56, a minimum of 7 calendar days applies where you have less than 3 months of service, and 30 calendar days where you have 3 months or more of continuous service — unless your contract specifies a longer period.
Can my employer charge me for visa cancellation costs? No. The 2024 Regulations expressly prohibit employers from charging employees for visa-related costs, including cancellation fees.
When Do You Need a Specialist ADGM Employment Lawyer?
- If you have been dismissed and believe the correct notice period, gratuity calculation, or repatriation entitlement was not applied.
- When your employer disputes your end-of-service gratuity, particularly following the removal of the two-year cap under the 2024 Regulations.
- When drafting or reviewing ADGM employment contracts, remote work arrangements, or company policies to ensure compliance with the new minimum standards.
- When dealing with a discrimination, retaliation, or protected disclosure (whistleblowing) claim within an ADGM entity.
- When structuring dual-licence arrangements between an ADDED-licensed entity and an ADGM-registered company.
- During ADGM company restructuring involving redundancies or collective terminations.
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