The UAE Government has announced fines ranging up to Dh1 million on Monday after a Federal Decree-Law was issued, amending specific provisions of the Federal Decree-Law on the Regulation of Employment Relationships.
Under the new provisions, a fine ranging from Dh100,000 to Dh1 million will be imposed on employers for the following violations:
- Employing a worker without a work permit or bringing them without providing any job
- Closing a business without settling right of workers
- Taking part in fraudulent labour acts including fraudulent employment or fictitious Emiratisation
- Employing a minor in violation of the law
- Engaging in any act of circumvention of the laws or regulations governing the labour market, including fictitious employment.
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As per the new provisions, the penalties will multiply based on the number of workers fictitiously employed.
Additionally, The Ministry of Human Resources and Emiratisation is now authorised to make a settlement provided that the employer pays 50 per cent of the minimum value of the fine and pays back to the government the financial incentives obtained by the fake employees.
The new decree stipulates that any criminal proceedings for fictitious employment, including fake Emiratisation, can only be initiated at the request of the Minister of Human Resources and Emiratisation or his/her authorised representative.
The decree also states that any disputes between employers and employees should be referred to the Court of First Instance — rather than the Court of Appeal — if there is a disagreement with the decision made by the Ministry of Human Resources and Emiratisation in resolving the dispute. This applies to all cases except for those disputes that have been adjusted or reserved for the issuance of a judgement.
Starting from the date of implementation of the provisions, the Court of Appeal is required to refer all requests, disputes and grievances regarding the regulation of employment relations to the Court of First Instance.
As per the new provisions, the court shall revoke proceeding with any claims filed after two years from the termination of the employment relationship.
This decree is part of the country’s ongoing efforts to develop its legislative and legal framework. It aims to ensure the efficiency and competitiveness of the labour market, regulate employment relationships, and clearly define the rights and obligations of all parties involved, and ensure their protection by law.