As part of its efforts to enhance its legislative and legal framework, the UAE government has recently introduced amendments to its federal decree law on employment relationships, imposing fines of up to AED 1 million for five specific violations.
Companies will be fined AED 100,000 to AED 1 million if they employ a worker without a work permit or bring them into the country without providing any job. Closing a business without properly compensating the employees as well as participating in fraudulent labor acts such as fraudulent employment or fictitious Emiratisation will also be penalized. Violators also include those employers who will hire minors and engage in any fake employment or commit any act to evade labor market laws or regulations.
The fines will go up depending on the number of workers fictitiously employed.
The new law empowers the Ministry of Human Resources and Emiratisation (MOHRE) to resolve labor cases, on the condition that the employer pays at least 50% of the minimum fine and pays back to the government the financial incentives received by fraudulent employees.
It also stipulates that in case of a disagreement with the decision made by MOHRE in resolving any dispute between employers and employees, it should be then referred to the Court of First Instance, and this applies to all cases except for those that have been adjusted or reserved for the issuance of a judgement.
