Businesses can leverage skilled employees from a growing talent pool of the vast UAE workforce. In order to do this, you need to set up a legal entity in Dubai. Don’t have time, then choose employer of record (EOR in Dubai) services to build and manage a team in the UAE.
Employer of record in UAE can help businesses bridge the gap between hiring and following local employment and legal laws. However, this advantage requires some legal considerations for UAE laws and labour regulations.
This can avoid contract breaches, visa law regulations and compliance with the Ministry of Human Resources and Emiratisation. By reading this blog, you can understand key legal considerations before hiring Dubai EOR services.
What is an EOR and How Does it Help an Organisation?
In order to hire employees from the UAE, companies must set up a legal entity, which can be time-consuming and expensive. An Employer of Record acts as a third-party organisation which hires employees on behalf of a company. It acts as the legal employer for your employees and ensures compliance with local laws. People working in the EOR firm usually have connections with government offices and authorities to speed up various legal processes.
EOR provides various benefits, allowing businesses to focus on core activities without worrying about legal presence in the UAE. The following are some important reasons to choose EOR services:
- Handle visas and work permits: EOR services in UAE take care of employees’ work permits, visas, and Emirates ID, so they can start working without delays.
- Complete knowledge of local labour laws: The rules in the UAE can be challenging for you to follow, along with a lot of other business operations. But, your EOR partner has all the needed knowledge on local employment laws that save you from any legal trouble. They ensure everything from onboarding and payroll processing to work permits and termination are compliant with local law.
- Run a business in UAE without a physical setup: Expand your business without actually renting a space in the UAE. EOR can hire and manage top talent in the UAE on your behalf.
- Payroll and benefits done right: Your EOR company in Dubai handles the entire payroll process to ensure accurate and timely salary transfer to employees as per WPS regulations.
- Manage employees: EOR service providers handle every aspect of employee management, starting from onboarding to termination. They also provide regular training to employees to help them with their tasks.
Legal Considerations for Using an EOR in Dubai
The following are some important legal considerations for Dubai EOR services:
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UAE Labour Laws
EOR service providers must comply with the latest labour laws to ensure justice and maintain employment standards. It helps in offering a safe workspace for employees and prohibits inhumane practices. The following are some important laws that every EOR must follow:
- Employees should be treated equally irrespective of gender, political affiliation, national origin, religion, or disability. In terms of violation of these rules, you may be fined up to one million dirhams ($272,249) and imprisoned for 5 years.
- Employers must protect their employees from work injuries or dangers that arise due to their duties.
- The terms and conditions of the employment must be outlined in detail and signed by both parties.
- The working hours limit is 8 hours daily and 48 hours per week. In terms of overtime, a 25%-50% premium must be given beyond the normal salaries.
- All private sector employees must be given mandatory health insurance during the working period.
It is important to know that Dubai is considering a 4-day work week. In 2025, this rules can be applied to all employers; therefore, EOR must follow them.
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Work Visa and Permits
As per the Emirati employment laws, EOR employers must provide the appropriate work permits and visas to international hires. Usually, the standard employment visa works well for most employees. However, specific categories include freelancers and investors who can opt for the Green and Golden Visas.
Working with established EOR companies can help in understanding the duration, requirements, fees and renewal process of the visa. EOR also ensures background verification of employees to check criminal and financial history. This can ensure smooth employee onboarding and compliance with visa-related laws.
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Annual Leaves
A full-time employee in any Dubai-based company is entitled to 30 days of annual leave. This leave can be used within a year unless the company allows carry-forward leaves. Such leaves can include both national and public holidays. However, if employees take more than these leaves, they may be unpaid.
Other than these, an EOR service manages maternal, paternal, sick and bereavement leave. These are as follows:
- A female employee may take a 60-day leave for pregnancy, during which 45 days are full wages while 15 days are half wages. This leave must be applied for 30 days prior and can be extended for 45 days without pay.
- As of 2025, other than a 5-day parental leave, there are no additional leaves for fathers.
- Once the probation period ends, employees in Dubai can have 90 days of paid sick leave.
- An employee may have 3 days of bereavement leave for a family member’s death. However, a 5-day paid leave is given for the death of a spouse.
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Wages Protection System
The United Arab Emirates considers timely wages and fair salaries to be important employment criteria. Due to this, the Ministry of Human Resources and Emiratisation (MoHRE) makes it mandatory to have an electronic wage protection system. It allows the electronic transfer of salaries, especially for international employees.
Moreover, this also helps with multi-currency payroll management. Every EOR must have a WPS to avoid penalties from MoHRE and the Central Bank of the UAE.
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Employment Contract
UAE regulations dictate that a written employment contract is valid and mandatory for all businesses. A verbal contract is often prone to breaches, so a detailed document must be formed. Additionally, only permanent employees are allowed this contract. It is usually for 3 years, which may be extended for a fixed term. This is a legally binding document which must include the following details:
- Name and information of the employer and employee.
- A clear job description with roles, duties, deliverables and expectations.
- Additional benefits offered by the company and breakdown of salary allowances.
- Company policies, confidential clauses, and other legal permits related to employment.
- Contract termination details, probation period, and gratuity information.
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Employee Benefits
An effective EOR service offers employee benefits, including health insurance, travel finance, life insurance, and more. Working with an established EOR office in Dubai can offer your employees retirement plans and attractive benefits for retaining them.
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Administrative Responsibilities
When an EOR hires employees, it also takes care of administrative and HR duties. They must oversee payroll management and track employee performance and cultural environment to maintain positive relations with employees. This is why you must choose EOR services, which can communicate your company culture while meeting employee requirements.
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Probation and Notice Period
As per the UAE labour regulation, employees are subjected to a period of 6 months of probation. During this period, the company may terminate the employment based on factors like bankruptcy, performance issues, non-renewal or work permit. A 14-day notice is given before an employee is terminated. Before starting a new job, a Dubai employee must give a 30-day notice.
Final Words
Before you develop your international hiring strategy for Dubai, always be mindful of this legal consideration. You must communicate with your EOR provider to ensure visa sponsorship, employee benefits, legal compliance, and UAE labour regulations. We hope you find this article helpful and use this information to avoid any legal issues while hiring in Dubai.
Sources: https://www.mohre.gov.ae/en/laws-and-regulations/laws.aspx
