UAE Labour Law Amendments | What Employers Need to Know

The new UAE labor law amendments require modifications regarding contracts, work permits, working time, safety rules, leave policies, and compliance fines. The changes have to be kept tracking; otherwise, the employer might face penalties. ArnifiHR aids in hiring by providing EOR-based compliance services for supporting businesses to manage the onboarding process, payroll, and documentation in a legal yet hassle-free manner.

1. Introduction

The UAE environment has always been dynamic concerning labor law changes for a future-ready workforce. The UAE labor law amendments aim at improving workplace standards, enhancing employee protection, and thus aligning with the country’s long-term economic vision. For employers, it is mandatory to keep up with the changes owing to non-compliance risks, fines, and business disruption.

HR teams have to keep track of changes since regulations change fairly often. This includes UAE work permit changes, UAE employee rights, employer obligations in the UAE, wage protection in the UAE, and documentation standards. Here, support partners become useful. 

ArnifiHR, a UAE-based Employer of Record, helps firms with compliance, onboarding, contracts, payroll, and documentation after the employer has selected the candidate. ArnifiHR does not recruit or hire; its function is to ensure every HR step is legally compliant, once a company has selected its employee.

2. Key UAE Labour Law Amendments Employers Should Know

2.1 Amendments to Employment Contract Rules

The most considerable change introduced by the new labor laws in the UAE is in the area of contracts of employment. Employment contracts are continuously refined fixed-term contracts, whereby both employees and employers enjoy more flexibility. Specified minimum term lengths for contracts, renewal requirements, and notice periods for permanent termination are now clearer with the new regulations. Companies must also ensure that any adjustments to terms of employment, such as salary changes, job titles, or responsibilities, are officially documented through the use of amendments.

These also feature updates about employee obligations concerning transparency at work. Non-harmonization of documentation, wrong dates in contracts, and unsigned renewals can now attract penalties. This is especially critical for companies with hundreds of employees or companies that have employees frequently changing roles. Keeping contracts updated is an important aspect of compliance for HR teams, and hence, accurately recording is important to them.

2.2 Updates to Work Permit Categories

UAE has continually been expanding and refining its category of work permits to keep up with the myriad employment arrangements. These new permits include freelancers, part-time hires, project-based employees, students, and holders of Golden Visas. One should have a good understanding of these categories because the designated work permit must always fit the actual job role.

It must be ensured that the candidate’s work permit fits his or her job responsibilities and falls under the industry sector. Several newly established companies overlook this, which can greatly accentuate penalties or delays when onboarding. Also affected by these updates are UAE work permits concerning remote jobs and flexible roles, which, although compromising more alternatives, will also require careful compliance upon onboarding.

2.3 Changes to Working Hours and Overtime Policies

Clarifications were made in the 2025 UAE labor changes regarding working hours, shift patterns, and overtime calculations. Despite all that, the typical 48 hours per week as a maximum is still retained to ensure that guidelines on how scheduling and breaks are to be planned are in place, which ideally should not miss tracking actual time. Updates also clarify the reduction in working hours during Ramadan and overtime compensatory rules for night shifts, weekends, and public holidays.

Many companies have compliance issues with miscalculated overtime or undocumented work hours. Nowadays, labor inspectors are more focused on payroll accuracy and records complying with WPS. Even accidental misreporting of working hours could cause audit issues. Employers must always ensure that proper logs exist and that overtime is calculated exactly as it is stated in the regulations.

2.4 Regulations on Workplace Safety and Well-Being

With new amendments, there are heightened expectations of companies to meet in terms of safety at work, especially in sectors such as construction, logistics, or manufacturing that are considered a higher risk. Heat stress management provisions include new rules, which demand correct compliance within intervals of rest and hydration requirements, as well as the equipment needed for the protective gear.

Mental well-being is also more prominent. There is now a need for employers to show they have reporting and accountability systems for workplace stress, harassment, and burnout incidents. For example, the UAE now needs more detailed reporting and recording of incidents, which introduces new responsibilities for HR and compliance teams, even for field work or handling heavy machinery.

2.5 Amendments to Leave Policies

The latest changes relate to maternity leave, compassionate leave, study leave, and unpaid leave categories. The UAE labor law provides much more clarification on entitlement, thus requiring better documentation and structure for employers and employees. Employers now have a requirement to keep leave records that are more specific in terms of the approvals granted and supporting documentation or return-to-work confirmations.

With regard to maternity leave extensions or compassionate leave, documentation is necessary, and this must now be kept in employees’ files for audit purposes. Any inconsistencies in these records could lead to penalties or disputes, thus suggesting the strengthening of the need for well-structured HR systems.

2.6 End-of-Service (Gratuity) Calculation Adjustments

More are claiming to redefine the end-of-service benefits (EOSB) framework within the UAE. The approval of fixed, temporary contracts still states that gratuity includes basic salary, years of service, and service bonus. However, 2025 adjusts clarification on caps on calculating and populating settlement periods and penalties for delays.

The common problems that harass employers:

• EOSB is calculated incorrectly
• Payments are delayed
• Contract end dates don’t match payroll records
• Settlement documentation is incomplete

2.7 Anti-Discrimination and Equal Opportunity Provisions

In a continued attempt to become one of the strongest anti-discriminatory laws in the world, the UAE has made equal opportunities by gender, nationality, disability, and race. Such protection is supposed to be reflected in the recruitment, promotion, training, and evaluation policies of employers. On top of this, more detailed guidelines must be produced together with policies prohibiting harassment, bullying at work, and misconduct.

These rules create safer and more inclusive work environments, but compliance requires regular training of managers and employees, a reporting mechanism, and firm action on complaints.

2.8 Stricter Penalties for Non-Compliance

The latest amendments to the UAE labour law impose stricter penalties for violations, including WPS failures, wrong visa processing, absent contracts, safety breaches, and delayed salary disbursements. The trend continues toward clean payroll processes and accurate documentation oriented toward the UAE. A few days of delay on salary, bonuses, warnings, or even penalties.

This underlines the importance of continuing compliant HR operations, especially in larger companies with multiple employees or in rapid growth.

3. What Employers Can and Can’t Check | Background Screening Clarifications

Labour law amendments work on existing rules or “provisions of law” regarding the UAE background checks requirements. Employers are allowed to check:

• Identity documents
• Education and qualifications
• Employment history
• Criminal records (when relevant)
• Professional licenses

However, they cannot request:

• Personal medical history
• Family information
• Irrelevant financial information
• Non-public social media access

These rules are designed to ensure fairness and transparency.

4. How These Labour Law Amendments Affect Everyday HR Operations

All HR management processes, from onboarding, contract creation, leave tracking, payroll, WPS reporting, and EOSB calculations, were affected. These constant changes lead to untidy processes in the companies. Misinterpreting even a tiny update could lead to fines or operational variations.

5. How ArnifiHR Eases the Process as an EOR Service

ArnifiHR EOR services help employers stay compliant with UAE labour law amendments by managing:

• Contract creation and renewals
• WPS-compliant payroll
• Leave and attendance tracking
• Visa and work permit compliance
• EOSB calculations and settlements
• Accurate documentation aligned with the latest regulations

To clarify, ArnifiHR only steps in after the employer has selected a candidate. ArnifiHR does not recruit; it just supports the employer in terms of compliance with UAE legislation to ensure legal employment operations.

6. FAQs

1. What are the latest UAE labour law amendments?

They include updates to contracts, work permits, overtime rules, safety laws, leave policies, and penalties.

2. How often does the UAE update labour rules?

Regularly, typically yearly, as part of ongoing labour market reforms.

3. Do these changes affect free zone companies?

Many do, though some free zones have additional internal regulations.

4. What happens if a company doesn’t comply?

Penalties can include fines, visa blocks, or WPS suspension.

5. Can an EOR help companies stay compliant?

By managing compliant contracts, payroll, leave, documentation, and visa processes.

7. Conclusion

Updating the amendments in the UAE labour law is a significant responsibility of every employer. Given the frequency with which regulations evolve, businesses have to ensure that their HR processes and documentation are correct at all times to be compliant and avoid penalties. ArnifiHR enhances compliance in matters of HR handling, freeing up companies to grow their businesses. For expert UAE compliance support, connect with ArnifiHR today.