Join our Breakfast Meeting “The New Labour Law and Human Resources” on Tuesday, 18 January
Wow! Many did not expect this start to 2022! We were lucky to experience a few days of rain, though it’s not sure if sun-seeking tourists shared our joy. The new working week for governmental institutions and the majority of private industry companies left roads surprisingly empty on Friday morning. We also saw the return of online school as a circuit breaker to curb the spread of the virus. On top of that, the country is preparing for the new UAE Labour Law (Federal Decree by Law No. (33) of 2021) coming into effect on 2 February 2022.
This is the ideal time to strategise with your senior leadership and HR team to increase their understanding the new law and review your current practices.
In December 2021, we had outlined some of the major changes. Here are three more important changes that you’ll need to be prepared for:
The new UAE Labour Law grants sick leave after the probation period. At the moment, employees have to complete their probation period and 3 months after that before they qualify for paid sick leave.
The actual sick leave entitlement remains the same:
- The first 15 days with full pay
- The following 30 days with half pay
- The following period shall be unpaid
Currently, employees have to inform their employer within 2 days of their sickness. Under the new law, employees will have 3 days to notify their company and to produce a medical report.
Employees are still not entitled to paid sick leave if the illness is a result from their misconduct. However, what classifies misconduct will still need to be specified in the Executive Regulations.
Working from Home (WFH) during COVID
Cases have been on the rise again and organisations are increasingly encouraging WFH where possible. This may benefit infected employees who are asymptomatic or have only mild symptoms. Although they cannot work from the office, they may continue to work from home without taking sick leave. While the new law is silent on this topic, companies can determine these policies themselves.
End of Service Benefits (EOSB)
Under the new UAE Labour Law, EOSB are potentially heavily impacted. Employees will need to work for 1 year to be eligible for EOSB. However, currently, employees who voluntarily resign receive a pro-rated payment if they’ve worked less than 5 years. This practice will be removed from 2 February 2022 onwards. Employees will be entitled to 21 days of EOSB regardless if they’ve worked 1.5 or 4.5 years.
The big change is the way days are calculated. At the moment, EOSB is based on calendar days. In the new law, this has been changed to working days. This can have a significant financial impact for organisations. EOSB payments can increase by 40-55%. Some companies have been taken by surprise when conducting the initial cost analysis.
At the moment, we are still awaiting clarity on the definition of working days. Companies will need to review their accrual procedures and financial implications.
Find out more during our Breakfast Meeting
Join us at the Norwegian Business Council’s breakfast meeting on 18 January 2022. Thenji Moyo from Gateley Legal and Agni Skafidas from OLAM Group will discuss the upcoming changes. Find out how you’ll be impacted and how best you can prepare and achieve legal compliance.