This week, several employees asked us the same question :
“Am I getting the right end-of-service gratuity under the New UAE Labour Law ? ”
We also keep seeing confusion around probation, notice periods and annual leave especially since the New UAE Labour Law is still based on Federal Decree-Law No. 33 of 2021, effective from 2 February 2022, together with its later amendments and implementing decisions .
What we notice in practice is simple :
Most employees know they have rights, but not always how those rights are calculated or applied .
This guide answers the most common questions about gratuity, leave, working hours, WPS, employment contracts and termination under the New UAE Labour Law .
What Does the New UAE Labour Law Cover in 2026?
The main federal framework governing private-sector employment remains Federal Decree-Law No. 33 of 2021, as amended .
The New UAE Labour Law regulates areas including :
- Employment contracts
- Working hours and overtime
- Annual leave
- Sick leave
- Maternity leave
- Probation periods
- Wage payments
- Termination and notice periods
- End-of-service gratuity
- Employee and employer rights
- Labour disputes
It generally applies to private-sector employees in the UAE,
Whether UAE nationals or expatriates. Government employees and domestic workers are subject to separate legal frameworks.
Employees in financial free zones such as DIFC and ADGM can also be subject to their own employment regulations, so the applicable jurisdiction should always be checked first .
What Changed in UAE Labour Rules in 2026 ?
One of the clearest 2026 developments concerns salary protection .
Ministerial Resolution No. 340 of 2026 introduced an updated Wages Protection System framework for establishments registered with the Ministry of Human Resources and Emiratisation.
Under the current system, wages for the previous month are generally due from the first day of the following Gregorian month, and employers must transfer at least 85% of wages due on time where lawful deductions apply.
Another 2026 development concerns Emirati employees in the private sector.
From 1 January 2026, MoHRE set a minimum monthly salary of AED 6,000 for UAE nationals working in the private sector for the relevant Emiratisation requirements.
So when people refer to the New UAE Labour Law 2026, it is important to separate amendments and new implementing decisions from the underlying federal labour law.
What Are the Official Working Hours in the UAE?
For most private-sector employees, normal working hours are :
8 hours per day or 48 hours per week .
During Ramadan, normal daily working hours are reduced by two hours per day.
Different rules may apply to certain industries or categories of workers under the executive regulations .
Commuting time between home and work is generally not counted as working time, subject to specific exceptions .
What Are the Annual Leave Rights Under the New UAE Labour Law?
A full-time employee is generally entitled to :
- 30 days of fully paid annual leave after completing one year of service.
- 2 days for each month of service where employment exceeds six months but is less than one year .
Employees who leave before using accrued annual leave may be entitled to payment for unused leave calculated according to the applicable rules.
An employer may organise annual leave according to business requirements, but accrued leave generally cannot simply be withheld indefinitely.
Know your leave balance before resigning or signing a final settlement .
What Types of Leave Are Employees Entitled To ?
The New UAE Labour Law provides several types of leave for qualifying private-sector employees.
These include :
- Annual leave
- Sick leave
- Maternity leave
- Parental leave
- Bereavement leave
- Study leave where legal conditions are met
- Hajj leave
- Official public holidays
The entitlement, payment level and eligibility conditions differ by leave type.
Sick Leave
After probation, an employee may generally receive up to 90 days of sick leave per year, whether continuous or intermittent :
- First 15 days: full pay
- Next 30 days: half pay
- Remaining 45 days: unpaid
During probation, paid statutory sick leave is generally not available, although unpaid sick leave may be granted based on an approved medical report .
Maternity Leave
A female private-sector employee is entitled to 60 days of maternity leave :
- 45 days at full pay
- 15 days at half pay
Additional leave may be available in specific medical circumstances relating to pregnancy, childbirth or the health of the child.
Can You Be Fired While on Leave?
This question needs a careful answer because the type of leave matters.
Under Article 35 of the federal labour law, where termination occurs while an employee is on leave, the contractual notice period generally starts from the day after the employee’s scheduled return from leave, unless both parties agree otherwise .
Sick leave receives additional protection.
An employer may not dismiss a worker because of health unfitness before the worker has used the legally available leave, and official UAE guidance states that an employer may not dismiss an employee or serve termination notice while the employee is on sick leave on the ground of sickness. Once the statutory sick-leave entitlement is exhausted and the employee remains unable to return, termination may become possible subject to the law .
So being “on leave” does not produce one universal answer .
The reason for termination, the type of leave and the contractual notice provisions all matter.
What Are the Probation Period Rules ?
Under the New UAE Labour Law, probation cannot exceed six months.
An employer who wants to terminate an employee during probation must generally give at least 14 days written notice .
An employee cannot normally be placed on probation more than once with the same employer .
If the employee wants to leave during probation to join another UAE employer, the law generally requires at least one month’s written notice to the current employer, with the recruitment-cost rules applying as provided by law.
Probation may look temporary, but the legal notice requirements still matter .
How Does an Employer Terminate an Employee During Probation ?
The employer should not simply tell the employee to leave immediately .
Where ordinary probation termination applies, the employer must provide at least 14 days’ written notice before the intended termination date.
Different rules may apply where the employee has committed conduct that legally permits dismissal without notice
Those situations should not be confused with ordinary termination during probation .
What Is the Notice Period for Terminating an Employment Contract?
Outside probation, the contractual notice period must generally be :
At least 30 days and no more than 90 days
The party terminating the contract must give written notice, and the employment relationship normally continues throughout the notice period.
If a party fails to serve the required notice, notice-pay compensation may become due.
Where the employer terminates the contract, the employee is also generally entitled to one unpaid day per week during the notice period to search for another job, subject to the required advance notification .
What Type of Employment Contracts Are Used in the UAE ?
The current system uses definite-term employment contracts.
A key point often reported incorrectly online is the old three-year maximum.
Federal Decree-Law No. 14 of 2022 amended Article 8 so that an employment contract is concluded for a definite period that may be renewed by agreement between the parties. The former statutory three-year maximum was removed.
The New UAE Labour Law also recognises different work models including :
- Full-time
- Part-time
- Temporary
- Flexible work
The employment contract should clearly state the agreed work pattern, salary, position and key employment conditions .
How Is End-of-Service Gratuity Calculated?
For qualifying foreign full-time private-sector employees under the traditional gratuity system, gratuity is generally based on the employee’s last basic salary, not the total salary including allowances .
An employee must normally complete at least one year of continuous service to qualify .
The basic calculation is :
First Five Years
21 days of basic salary for each year of service .
After Five Years
30 days of basic salary for each additional year after the first five years.
Fractions of a year may be calculated proportionately once at least one year of continuous service has been completed.
The total traditional gratuity must not exceed two years’ wages.
Employers must generally settle outstanding wages and end-of-service entitlements within 14 days of termination .
Is There a Minimum Wage in the UAE ?
The federal New UAE Labour Law does not currently prescribe one general minimum salary applicable to every private-sector employee.
Official UAE guidance states that wages should be sufficient to meet employees’ basic needs but does not specify a universal statutory amount .
However, UAE nationals working in the private sector are subject to a separate current rule under which the minimum monthly wage is AED 6,000 from 1 January 2026 for the relevant Emiratisation framework .
What Are the 2026 WPS Penalties ?
The Wages Protection System (WPS) is one of the areas with a genuine 2026 regulatory update.
Under Ministerial Resolution No. 340 of 2026, enforcement escalates as wage delays continue. Current official guidance includes :
- From the due date : electronic monitoring begins.
- From day 2 : warnings and electronic notifications.
- Day 5 : suspension of new work permits for non-compliant establishments.
- Day 11 : repeat offenders within six months may face administrative fines and reclassification to Category Three.
- Day 16 : qualifying cases can trigger automatic individual or collective labour-dispute procedures and additional permit suspensions.
- Day 21 : more serious enforcement can include an executable wage instrument, precautionary attachment measures, travel restrictions on the responsible person and referral to competent authorities in qualifying cases.
The exact action depends on factors such as establishment size, number of affected workers, sector and whether the violation has been repeated.
For employers, WPS compliance is therefore not simply a payroll administration issue .
What Rights Do Employees and Employers Have ?
Employee Rights May Include
- Timely payment of wages
- Statutory leave
- Safe working conditions
- Contractual and statutory notice
- End-of-service entitlements where applicable
- Protection against prohibited discrimination and harassment
- Access to labour-dispute procedures
Employer Rights May Include
- Requiring employees to perform agreed duties
- Applying lawful workplace policies
- Taking disciplinary action using the required procedure
- Terminating employment where statutory and contractual requirements are met
- Protecting confidential information and legitimate business interests within the limits of the law
The New UAE Labour Law is not designed to give one side unlimited power over the other.
It sets rules for both .
Frequently Asked Questions About the New UAE Labour Law
What Are the Main UAE Labour Law Changes in 2026?
The most significant 2026 operational changes include the updated WPS framework under Ministerial Resolution No. 340 of 2026 and the AED 6,000 monthly minimum salary requirement applicable to Emirati private-sector employees under the relevant Emiratisation rules.
The underlying federal private-sector labour framework remains Federal Decree-Law No. 33 of 2021, as amended .
How Is End-of-Service Gratuity Calculated?
For qualifying full-time foreign employees under the traditional gratuity system, it is generally calculated on the last basic salary at 21 days per year for the first five years and 30 days per year thereafter .
What Is the UAE Employment Notice Period?
Ordinary contractual notice must generally be between 30 and 90 days.
Can an Employer Terminate an Employee During Probation?
Yes, but ordinary termination during probation generally requires at least 14 days’ written notice .
How Much Annual Leave Does an Employee Receive?
Employees who complete one year of service are generally entitled to 30 days of fully paid annual leave
Between six months and one year of service, entitlement is generally two days per month.
What Happens If My Salary Is Paid Late?
Employees can submit a wage complaint to MoHRE, while employers may face escalating WPS measures depending on the length and seriousness of the delay .
Know Your Rights Before the Problem Becomes a Dispute
The New UAE Labour Law affects much more than what appears on an employment contract.
A disagreement about salary, annual leave, probation, notice or gratuity can quickly become a formal labour dispute when either side acts without understanding the rules .
FRM Legal Counsels assists employees and employers with employment contracts, unpaid wages, termination, end-of-service gratuity, leave disputes, disciplinary matters and other UAE employment-law issues.
Speak with FRM Legal Counsels if you need clear advice on how the New UAE Labour Law applies to your employment situation before taking the next step .
