Labour Law Reforms in the UAE:
Impact on Employment Practices

The United Arab Emirates (UAE) has implemented considerable labour law reforms in recent years, with the goal of modernising employment practices and improving the overall work environment. These revisions demonstrate the UAE’s determination to match its labour laws with international norms, improve worker rights, and encourage a more dynamic and flexible labour market. This essay investigates the significant revisions in UAE labour law and their implications for employment practices.

Key Labour Law Reforms.
1. Federal Decree-Law No. 33 of 2021 on Regulation of Labour Relations.
Federal Decree-Law No. 33 of 2021, often known as the New Labour Law, was enacted on January 2, 2022, and brought about numerous substantial changes in the UAE’s employment sector. The new legislation supersedes Federal legislation No. 8 of 1980 and includes several revisions aimed at improving the workplace and adapting to modern employment practices.

a. Employment contracts.
The new law requires all employment contracts to be fixed-term (up to three years) with the possibility of renewal. This move is intended to give more clarity and consistency for both companies and employees.
The Ministry of Human Resources and Emiratisation (MOHRE) has established a standardised template for employment contracts, assuring uniformity and transparency in conditions.

b. Employee Termination.
The reform clarifies notification periods for termination. The notice period is normally 30 days, but can be extended depending on the provisions of the employment contract.
Employees are entitled to severance compensation depending on length of employment, with established rules for calculation. This attempts to give employees with more financial stability in the event of their termination.

c. Working Hours and Leave.
The law limits working hours to eight hours per day or 48 hours per week, with overtime compensation. This adjustment is meant to improve work-life balance.
Employees are entitled to a minimum of 30 days of yearly leave, with specific requirements for accrual and usage.

d. Non-discrimination and Equal Opportunity.
Equality: The new legislation emphasises non-discrimination in the workplace, requiring equal opportunity regardless of gender, nationality, or handicap. This reform seeks to create a more inclusive and equitable work environment.

2. Federal Decree Law No. 7 of 2022 on Insurance Against Employment Injury.
Another key reform is the implementation of Federal Decree-Law No. 7 of 2022, which establishes a required insurance program to cover workplace accidents and illnesses. This reform introduces:

a. Mandatory Coverage: Employers must offer insurance coverage to protect employees from work-related injuries and illnesses. This coverage guarantees that employees are compensated for medical bills and loss of income as a result of workplace accidents.

b. The new law streamlines the claims and compensation procedure for employees, improving speed and transparency.

3. Labour market reforms.
a. Emiratisation Initiatives: The UAE aims to increase job opportunities for UAE nationals in the private sector. These include quotas and incentives for enterprises that hire Emiratis, which serve to increase local employment and skill development.

b. Flexibility and Remote Work: The new laws allow for flexible employment arrangements, such as part-time and remote work. This flexibility is intended to accommodate current work patterns and promote work-life balance.