Misuse Of Work Permits, Fake Recruitment: Up To Dh1 Million Fine For Illegal Employment Activities In The UAE

The UAE Government has enacted a Federal Decree-Law amending specific provisions of the "UAE Labour Law". This move is part of ongoing efforts to enhance the legislative and legal framework, aiming to boost labour market efficiency and competitiveness. The decree seeks to regulate employment relationships, clearly define rights and obligations, and ensure legal protection for all parties involved.

The decree imposes fines ranging from Dh100,000 to Dh1 million on employers who violate its provisions. This includes employing workers without proper permits, failing to provide jobs after bringing workers into the country, misusing work permits, or shutting down businesses without settling workers' rights. The same penalties apply to illegal employment of minors or allowing minors to work unlawfully by their guardians.

New criminal penalties have been introduced for fictitious recruitment, including fraudulent Emiratisation. Employers found guilty of bypassing laws or regulations by faking recruitment will face fines between Dh100,000 and Dh1 million. These penalties are multiplied by the number of workers involved in such fictitious employment.

In cases of labour disputes, if there is disagreement with a decision made by the Ministry of Human Resources and Emiratisation (MoHRE), the case will now be brought before the Court of First Instance instead of the Court of Appeal. Claims filed after two years from the termination of employment will not proceed under this law.

Criminal proceedings for fictitious employment can only be initiated at the request of the Minister of Human Resources and Emiratisation or an authorised representative. The Ministry also has the authority to settle such cases upon employer request before a court sentence is issued. This requires the employer to pay at least 50 percent of the minimum specified fine and return all financial incentives received by fictitious employees.

The new decree-law mandates that Courts of Appeal refer all requests, disputes, and grievances regarding employment relations to the competent Court of First Instance from the date of implementation. This excludes disputes that have already been adjudicated or reserved for judgment.

This legislative update aims to create a more transparent and fair labour market in the UAE. By imposing strict penalties on violations and providing clear guidelines for dispute resolution, it seeks to protect both employers' and employees' rights effectively.