The Ministry of Human Resources and Emiratisation (MOHRE) has recently announced that new legislation will replace Federal Law No. 8 of 1980 (Current Labour Law) as of 2 February 2022 (the Effective Date).
While Federal Decree Law number 33 of 2021 (New Labour Law) replaces the Current Labour Law in its entirety many of its terms are familiar and remain the same. It is a mixed bag of changes that may benefit both employees and employers depending on the circumstances. With our employers’ hat on, the cost of dismissals does not appear to have increased (if anything this may decrease) and the introduction of mandatory fixed-term contracts may make it simpler to part ways with employees in circumstances such as poor performance. Employees may welcome the expansion of articles outlawing discrimination but many sectors will lament the changes to the calculation of End of Service Gratuity (EOSG). There is a clear reversal from the current court practice of including an average increment for commission as part of the relevant wage.
We summarise our key insights for employers below.
Anti-discrimination provisions
The Current Labour Law already includes a general prohibition on discrimination, and mandates equal pay for men and women where they are performing the same work; however, these provisions remain untested and the mechanism in respect of wage discrimination has not been confirmed. In terms of discrimination generally there are no specific penalties.
The New Labour Law...
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