On 16 November 2021, the United Arab Emirates published the new Labour Law, i.e., Federal Labour Law No. 33 of 2021 (“New Labour Law”) which repealed the Federal Labour Law No. 8 of 1980. The New Labour Law will come into force on 2 February 2022 and is expected to bring about significant changes to existing employment framework in the country. In this legal briefing, we provide an overview of the most notable changes introduced by the New Labour Law and their potential impact on the existing and future employment arrangements in the UAE.
I. Main changes for employment law
The New Labour Law has introduced several changes, among which the most notable are in relation to fixed-term contracts, new work models, end of service gratuity, maternity leave and easing of competition restrictions. We will discuss these important changes briefly, hereinbelow.
To bring clarity and uniformity in the employment relationships, the UAE under the New Labour Law has abolished the option for the companies to have both limited term and unlimited term contracts with their employees. Under the New Labour Law, there will now only be fixed-term contracts for all employees up to a maximum of three years. Art. 8 (3) of the New Labour Law stipulates this new model including the permissibility to extend or renew this contract for another similar period or for a shorter period. Employers now have one year from coming in force of the New Labour Law to convert...
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