Employment Relations Legal Issues in the UAE: A Real-World Look at Labour Law

 


It was late in the evening when I got a call from Rahul, an IT specialist working in Dubai. His voice was tired, almost frustrated.

“My company just let me go… And they’re saying I don’t deserve gratuity. Is that even legal?”

I paused, took a deep breath, and said, “Rahul, let’s talk this through.”

That’s the thing about employment relations in the UAE: the issues are often personal, emotional, and, most importantly, solvable if you know what the UAE Labour Law actually says.

Why Labour Law Matters Here

The UAE isn’t just a workplace; it’s a melting pot. People from every corner of the world come here chasing career opportunities. With that diversity comes complexity: different expectations, different understandings, and sometimes, messy misunderstandings.

This is exactly why the UAE Labour Law exists. It’s not about favouring one side over the other. It’s about striking a balance between protecting employees from unfair treatment while ensuring businesses can operate smoothly without being taken advantage of.

The Everyday Issues Employees Face

If you sit down with any group of expats over coffee, sooner or later, someone will bring up a workplace story. Some are good, but many highlight legal grey areas. Here are the ones I hear most often:

1. Contracts That Don’t Match Promises

It happens more than you’d think: an offer letter says one thing, the official MOHRE contract says another. What most people don’t realise is that the MOHRE-approved contract is what counts in law, not the offer letter.

2. Probation Period Drama

Probation is meant to test the waters, but it often causes headaches. Employers sometimes try to extend it past six months (which isn’t allowed), while employees think they can walk out with zero notice. Both sides are wrong; notice rules still apply.

3. Sudden Terminations

I once helped a young marketing executive who was let go without any clear reason. The company thought they could just end her contract and move on. But under UAE labor law, employers need a valid reason for termination. Otherwise, it’s considered wrongful dismissal, and compensation might be due.

4. End-of-Service Gratuity Confusion

Let’s be honest: most employees don’t fully understand gratuity until they need it. The rule is simple: if you’ve worked at least a year, you’re entitled to it. But it’s based on your basic salary, not allowances, and the calculation changes depending on how many years you’ve worked. This is where most disputes begin.

5. Workplace Discrimination and Harassment

This is one area where the UAE has made strong progress. The Labour Law now explicitly prohibits discrimination based on gender, race, religion, or disability. It also sets penalties for harassment and bullying something that wasn’t clearly defined before.

Rahul’s Case: From Panic to Peace

Back to Rahul. He had worked at his company for more than four years. When they fired him, they claimed his performance wasn’t good enough, so he didn’t qualify for gratuity.

But here’s the truth: unless someone is dismissed for very specific cases of serious misconduct (think fraud, theft, or gross negligence), they’re still entitled to end-of-service benefits. I explained this to him, step by step.

A week later, he filed a complaint through MOHRE. Within a month, the company was ordered to pay what he was owed. When he called me back, I could hear the relief in his voice.

“Knowing my rights made all the difference,” he said.

Employers Face Issues Too

It’s easy to focus only on employees, but employers face challenges as well.

A small business owner I know in Abu Dhabi once had a staff member walk out with no notice. He had invested months in training, and the sudden exit left him short-handed.

His first reaction was anger. “I’ll just hold his final salary until he comes back!” he told me.

But that’s not allowed. UAE Labour Law is clear: you can’t withhold wages or passports. However, the employer could file a claim for compensation for the employee’s failure to serve notice. Again balance is the key.

What’s New in UAE Labour Law

The UAE doesn’t let its labor regulations gather dust. In recent years, there have been several major updates. Here are a few highlights worth knowing:

  • Flexible work options—part-time, remote, and freelance arrangements are now recognized legally.

  • Equal pay, regardless of gender—salary discrimination based on gender is prohibited.

  • Clearer rules for working hours—overtime must be paid fairly, and employees can’t be overworked without compensation.

  • More family-friendly policies—Parental leave and maternity benefits have been strengthened.

  • Unfair dismissal protection—Employees can challenge terminations without valid reasons.

These changes show the UAE’s commitment to being competitive globally while maintaining fairness locally.

Lessons We Can All Learn

What stands out from all these stories, Rahul, the marketing executive, and the small business owner is this: employment relations issues don’t have to end in conflict if both sides know their rights and responsibilities.

For employees, this means don’t sign contracts blindly. For employers, it means treat staff fairly, but also protect your business interests within the law.

Knowledge is the safety net here.

Quick Tips for Staying Safe Under UAE Labour Law

Here are some friendly, practical pointers I share often:

  1. Read before you sign— Don’t just glance at your contract. Go through it line by line.

  2. Keep everything documented – Save copies of contracts, emails, warnings, and resignation letters.

  3. Know your notice period—whether quitting or terminating, respect the time frame.

  4. Use MOHRE’s support—they provide mediation and official dispute resolution services.

  5. Get advice early—small problems become big when ignored.

Wrapping Up With a Coffee Story

A month after his case ended, Rahul and I met again. This time, he was relaxed, smiling, and already planning his next career move. He said, “I honestly feel like I got my life back.”

That conversation reminded me of something important: labor law isn’t just about policies or contracts—it’s about real people, their dreams, and their stability.

So here’s my final word: whether you’re hiring staff or signing a new job offer, take the time to understand the UAE Labour Law. It will save you stress, protect your rights, and keep relationships fair on both sides.

Because at the end of the day, the workplace isn’t just about work—it’s about people. And when the law is respected, everyone wins.

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