Changes to employment law are quite significant and require changes to existing employment contracts as well as changes to policies and procedures regarding future agreements with new employees. The UAE government plans to issue implementing regulations to provide additional guidance on the new laws. The United Arab Emirates (UAE), which has significantly updated its business laws in recent years, has once again revised and refined the country`s business legal landscape. The enactment of a new Commercial Companies Law, which entered into force on 2 January 2022, as well as the announcement of the introduction of corporate income tax for fiscal years beginning on 1 June 2023, provide companies operating in the UAE with new elements to consider when setting course in a post-pandemic world. Here we summarize the main changes to the UAE`s new Commercial Companies Law and explain what is currently known about the upcoming corporate tax system. The UAE also announced in early December 2021 a comprehensive social law reform programme and adopted a new Federal Law on Crime and Penalties, which changed the UAE`s stance on social issues. These changes, together with the trade adjustments discussed earlier and the recently described changes in labour law, can be seen as part of a concerted programme to bring the UAE into line with much of the rest of the world, both economically and socially. We clearly hope that these changes will boost economic activity in the UAE and solidify the country`s position as one of the most important international trade centres in the next decade and beyond, and we expect these changes to be welcomed by companies and investors, as well as affected employees. We recently detailed some of the adjustments in the area of employment following the entry into force of the new Labour Code in early February 2022. In this article, we will summarize some of the other changes recently implemented in the UAE. The UAE has experienced significant changes in its legal and social landscape over the past six months.
These changes have been much larger and faster than expected, illustrating the UAE`s willingness to remain at the forefront of development in the region. The precondition for the MoHRE/free zone agreement remains in place. However, changes can now be made to the MoRE contract template, and there are different forms depending on the type of visa/work model. Below is an overview of the main changes to the UAE`s labour legislation. The new Labour Code introduces a number of unexpected changes. The reasons for some changes are not always clear, and it is difficult to see how some provisions will work in practice, not least because many details of the new Labour Code have been outsourced in future implementing regulations. It is hoped that these implementing regulations will clarify existing areas of uncertainty. Nevertheless, there are a number of important aspects that affected employers must consider, and changes must be made to contracts, policies and work practices.
Important changes have been introduced with regard to compassionate leave rights, discrimination laws, termination of employment and non-competition clauses in employment contracts. The new law also allows companies to introduce part-time and flexible working arrangements. Here we summarize some of the most important changes to the legal framework. The changes introduced by Federal Decree No. 33 of 2021 were signed into law by President Sheikh Khalifa in November. The new Labour Code consolidates many of the changes introduced by the Ministry of Human Resources and Emiratisation (MHRE) through various regulations over the past five years and also introduces significant new changes, leading to a radical overhaul of labour relations in the UAE. It applies to the United Arab Emirates, each of the seven emirates and its free zones (with the exception of DIFC and ADGM). We hosted a series of webinars on UAE labour law, where Sara Khoja, Rebecca Ford and Samantha Ellaby highlighted the key operational changes required by the UAE`s new Labour Code. The webinar series explored termination of employment, employment contracts, employer policies, and what the new provisions mean in practice when it comes to discrimination and harassment. Our final webinar covered the key features of the implementing regulations, including hours of work and overtime, vacation, work regulations and non-compete obligations.
Key changes include shorter fixed-term contracts for most private sector workers, the ability to stay in the country for 180 days after leaving their jobs, and the introduction of job shares that may suit students and returnees. And there are significant changes in maternity leave. The UAE`s new labour legislation brings important changes for affected employers. Employers should consider developing strategies to implement these new changes next year. The Ministry of Human Resources and Emiratisation has made significant changes to the current immigration landscape. The regulations implementing the law refer to 12 types of work permits to reflect various sponsorship and employment contracts, including: Accordingly, the amendments to the new law require employers operating in the UAE to take the necessary measures to ensure compliance with the additional or amended provisions. Dr. Hassan Elhais, Legal Advisor at Al Rowaad Advocates, said the abolition of open-ended contracts, protection against discrimination and new working models such as flexible hours, part-time work and extra leave were the main changes. In addition to the changes to labour law, the UAE government has changed a Monday to Friday work schedule (with half a day on Friday) for all government employees. While not mandatory in the private sector, many private sector companies plan to introduce a Monday to Friday schedule to align with the government`s new schedule. Many of the job changes improve flexibility for employers and employees. Silvia Razgova/The National Under the previous law, a person whose residence visa had been revoked had only 30 days to find a new job or leave the country without paying fines for overstaying, making it one of the most significant changes.
10. Modification of the working time policy to reflect the overtime cap and changes in the calculation of overtime pay. At the end of November 2021, Federal Law 32 of 2021 on Commercial Companies (the new CCL) was announced, replacing the Commercial Companies Act of 2015 (as amended). The 2015 law was itself an important legislative milestone and heralded the biggest overhaul of trade regulations in the UAE in more than 30 years, including the 2020 amendments that lifted restrictions on some onshore companies for foreign ownership. The new CDC, which was launched on 2. January 2022, this modernization continues with the following changes: While the full impact of the myriad changes to UAE law is not immediately known, companies may want to hire short-term consultants to align their constitutional documents with the provisions of the new CDC. Businesses may also consider whether they want to make changes to existing ownership structures if they were designed to comply with previous versions of the Business Companies Act. One of the most notable protections of the new law is the prohibition of discrimination based on sex, gender, religion, age and national origin in the workplace. This offers some nationals the opportunity to improve their participation in the labour market.