The United Arab Emirates has a population of over 9 million people, with the top industries including oil, agriculture, and tourism. Payroll and compliance requirements can be complex with many regulations for starting a business and hiring employees.

Payroll and Tax Considerations:

  • No minimum wage is mandated, but UAE nationals must be paid according to certain requirements based on type of work and education level
  • The entry level salary must be at least AED 12,000 per month for employees with a college degree. For those with a high school education pay must be AED 5,000
  • Overtime is limited to 2 hours per day, and is paid at 125% of regular hourly pay. For night work overtime pay is 150% of regular hourly pay
  • Severance is paid if the employee has 1 year of service. The pay varies depending on the length of service and reason for termination
  • There is no income tax on individuals

HR and Statutory Requirements

  • Employees who have worked over 6 months but less than a year, earn 2 days of leave per month
  • For employees with more than 1 year of service, the annual leave is 30 days
  • Employees have a right to 90 days of annual sick leave after 3 months of employment
  • Permanent position employees receive 90 days of paid maternity leave
  • Fathers receive 5 days of paid paternity leave, to be taken within 6 months of the birth
  • Foreign workers must be approved by the Ministry of Labor, once determined that the job cannot be filled by a UAE national

Holidays in United Arab Emirates

  • January 1 – New Year’s Day
  • May 3 – Eid al-Fitr
  • May 4 – Eid al-Fitr Holiday
  • May 5 – Eid al-Fitr Holiday
  • July 9 – Arafat (Hajj) Day
  • July 10 – Eid al-Adha (Feast of Sacrifice)
  • July 11 – Eid al-Adha Holiday
  • July 12 – Eid al-Adha Holiday
  • July 30 – Al-Hijra (Islamic New Year)
  • October 8 – Mouloud
  • December 1 – Commemoration Day
  • December 2 – National Day

There are no statutory taxes in the UAE, and no year-end reporting is  required. Funding payroll in the UAE is not as flexible, as companies must have a local bank account in order to pay employees. Funds for processing payroll must come from a bank account in the UAE. Our in-country experts can assist with the requirements needed for bank account set up.

Blue Marble has created a cloud-based platform to manage employee payroll in 150+ countries. View payroll in real time with customized, aggregated reporting across all countries and currencies. Our unique hybrid service model gives you a dedicated US-based team and direct access to in-country experts to help when questions come up. Simplify payroll and compliance in the UAE – click here to learn more