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UAE – Fines increased for recruitment agencies and employers in breach of labour market rules

05 March 2015

The UAE’s Ministry of Labour will today begin fining companies for failure to issue labour contracts, the non-renewal of work permits during the grace period, and the non-renewal of the trade licence of private recruitment agencies, reports khaleejtimes.com.

Humaid bin Deemas Al Suwaidi, Assistant Under-Secretary of Labour Affairs, said that employers have 60 days from the date of expiry to renew work permits, issue a new work permit from the entry date to the UAE, or adjust the employee’s status, in order to avoid a fine of AED 500 (USD 136) for each month in breach of the regulations.

Mr Bin Deemas stressed the importance of documenting labour contracts through the Ministry, as well as the employer’s commitment to renew work permits in a timely manner, as it regulates relations between both parties and stabilises the labour market, thereby protecting rights.

He added that a 60-day period is sufficient for the employer to apply for all the labour-related requirements through service centres, therefore there is no justification for any delays.

“Starting on 5 March 2015, the Labour Ministry will issue administrative fines, as approved by the Cabinet, against private recruitment agencies if found with expired licences. The decision includes both temporary employment offices and [mediation] offices,” he explained.

Implementing the Cabinet’s decision, which came into effect on 5 January 2015, the Ministry has given temporary employment agency business owners a 60 day grace period to renew their licences and avoid the fine. The fine was previously issued the day after the licence expiry date.

Fines have increased by AED 1,000 (USD 272) for mediation agencies, and AED 2,000 (USD 544) for temporary employment agencies per month of delay.

“The previous amount was AED 10,000 (USD 2,722) for both,” Mr Bin Deemas added.