Private sector employment in the United Arab Emirates is governed by Federal Decree-Law No. 33 of 2021, the UAE Labour Law, and its implementing regulations, administered by the Ministry of Human Resources and Emiratisation (MoHRE). Financial free zones such as DIFC and ADGM have their own employment laws. Here is what employers need to know about leave, pay, tax and ending employment.
The Labour Law sets minimum leave for private sector employees. Part-time employees receive annual leave in proportion to the hours in their contract.
Fully paid after 1 year of service. Between 6 months and 1 year, 2 days for each month worked. Unused leave is paid out when employment ends.
After probation: 15 days on full pay, 30 days on half pay, then 45 days unpaid. The employee must notify the employer within 3 days.
45 days on full pay and 15 days on half pay, and can start up to 30 days before the due date. Paid by the employer.
Paid working days for either parent, taken within 6 months of the child's birth.
A mother who is ill because of pregnancy or childbirth can take up to 45 more days unpaid. If the baby is sick or has a disability, she can take 30 more days on full pay, extendable by 30 days unpaid. For 6 months after returning, she is entitled to paid nursing breaks of up to 1 hour a day.
Set up each UAE leave type in IceHrm with its own accrual, carry forward and approval rules, including pro-rata leave for part-time staff and tiered sick pay. Employees see their live balance before they apply, and managers see who is away on a shared calendar. Leave management →
There is no general minimum wage in the UAE. The exception is Emirati nationals in the private sector, whose minimum monthly wage is AED 6,000 from 1 January 2026.
Or 48 hours a week, with at least one paid rest day a week. Hours are reduced by 2 a day during Ramadan.
On basic pay, rising to +50% between 10 pm and 4 am. Overtime is capped at 2 hours a day.
On basic pay, or a substitute day off instead.
Capture attendance and overtime in IceHrm and feed the hours straight into payroll, so day and night overtime premiums reflect what was actually worked. Time & attendance →
There is no personal income tax in the UAE, at federal or emirate level, so employers have no income tax to withhold from salaries and employees have no personal tax return to file.
Corporate tax at 9% applies to business profits, and individuals running a business with turnover above AED 1 million may be liable for it, but wages and personal investment income are not counted.
Social security applies only to UAE and other GCC nationals. For expatriate employees, the main statutory cost on top of salary is the end-of-service gratuity.
Of contractual gross pay, with 5% from the employee and 2.5% from the government. Pay counted is between AED 1,000 and AED 50,000 a month.
For Emiratis employed in Abu Dhabi, with 5% from the employee and 6% from the government.
Other GCC nationals follow their home country's scheme. Expatriates are instead covered by end-of-service gratuity.
Employers can opt into MoHRE's voluntary Savings Scheme, paying 5.83% of basic salary a month (8.33% after 5 years' service) into an approved investment fund instead of the traditional gratuity. In DIFC, employers contribute to the DEWS workplace savings scheme instead of paying gratuity.
Build UAE pay the way you already structure it, with your own salary components, deductions and formula columns, such as a gratuity accrual or pension column. Want to know how well IceHrm handles payroll calculations for the United Arab Emirates? Contact us or see Payroll →
Either party can end the contract for a legitimate reason by giving written notice. Dismissing an employee because they made a valid complaint to MoHRE or sued the employer is arbitrary dismissal, and compensation can be up to 3 months' wages.
| Situation | Notice |
|---|---|
| After probation, either party | 30 to 90 days, as agreed |
| Employer ending employment during probation | 14 days |
| Employee leaving during probation to join another UAE employer | 1 month |
| Employee leaving during probation and leaving the UAE | 14 days |
Expatriate employees with at least 1 year of continuous service receive a gratuity based on their last basic salary, excluding allowances. Emiratis are covered by the pension system instead.
| Years of service | Gratuity per year |
|---|---|
| Less than 1 year | Nil |
| First 5 years | 21 days' basic salary |
| Each year after 5 years | 30 days' basic salary |
All wages and entitlements, including gratuity and unused leave, must be paid within 14 days of the contract ending. An employer may not give notice to an employee while they are on sick leave. During notice given by the employer, the employee can take 1 unpaid day a week to look for work.
The same public holidays apply to the public and private sectors. Islamic holidays follow the Hijri calendar and are confirmed by moon sighting, so they move about 11 days earlier each year.
Under Cabinet Resolution No. 27 of 2024, a holiday is not moved to another day if it falls on a weekend or another holiday. Employees who work on a public holiday get a substitute day off or basic pay plus at least 50%.
Leave groups give each office its own holiday calendar, so you can update Eid dates once they are announced and teams in Dubai, Abu Dhabi and abroad each get the right days off. Holiday calendars →
Private sector employees are hired on fixed-term contracts that can be extended or renewed, and a contract that simply carries on after expiry is treated as renewed on the same terms. The law recognises full-time, part-time, temporary, flexible, remote and job-sharing arrangements.
Probation cannot exceed 6 months and cannot be extended. A non-compete clause is allowed if it is limited in time, place and type of work, for no more than 2 years after the contract ends. Private sector employers of a certain size must also meet Emiratisation targets for hiring UAE nationals.
Send contracts for e-signing, store work permits, visas and Emirates ID copies on the employee's record, and track onboarding with task lists so nothing is missed on day one. Documents & e-signing →
This guide is general information to help you plan HR processes, not legal, tax or financial advice. Employment law and rates change regularly and awards, enterprise agreements and state rules may give employees more than the minimums shown here. Always confirm current requirements with the official sources or a qualified adviser.
Configure leave types, accrual rules and public holidays for United Arab Emirates, keep employee records and contracts in one place, and run payroll with your own salary components. Want to know how IceHrm handles payroll calculations for United Arab Emirates? Talk to us.
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