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Dubai Regulatory Environment

Administered by the Federal Ministry of Labour and Social Affairs, Labour Law in the UAE is loosely based on the International Labour Organisation's model. UAE Law No. 8 of 1980, as amended by Law No. 12 of 1986 (the "Labour Law") governs most aspects of employer/employee relations, such as hours of work, leave, termination rights, medical benefits and repatriation. The Labour Law is protective of employees in general and overrides conflicting contractual provisions agreed under another jurisdiction, unless they are beneficial to the employee.

The Ministry issues a model form of labour contract in Arabic which is widely used, but other forms of contract are enforceable, provided they comply with the Labour Law. End of contract gratuities are set at 21 days pay for every year of the first five years of service and 30 days for every year thereafter. Total gratuity should not exceed two years' wages. Employees are entitled to pro-rated amounts for service periods less than a full year, provided they have completed one year in continuous service.

Trade unions do not exist. In the case of a dispute between employer and employee, or in interpretation of the Labour Law, the Ministry of Labour and Social Affairs will initially act as an adjudicator, in an effort to resolve matters. If a party wishes to appeal any such decision it can take its case to court. Strikes and lock outs are forbidden.

The normal maximum working hours are eight per day or 48 per week. However, these hours may be increased to nine daily for people working in the retail trade, hotels, restaurants and other such establishments. Similarly, daily working hours may be reduced for difficult or dangerous jobs. Many businesses work on a two shift system (for example, 8am - 1pm and 4pm - 7pm). As in all Muslim countries, Friday is the weekly day of rest. In practice, commercial and professional firms work 40-45 hours a week and government ministries about 35. The weekend for office workers has traditionally been Thursday afternoon and Friday, but a number of organisations have changed over to a five day week with Friday and Saturday as the weekend. During the Muslim holy month of Ramadan, normal working hours are reduced by two hours per day.

There are 10 days of public holidays (paid) in any year. The employee's annual leave is two days for every month if his service is more than six months and less than a year. In every completed year of service after the first, an employee is entitled to 30 days annual paid leave. This is in addition to public holidays, maternity leave for women and sick leave.

Overtime is used extensively and additional pay is required for manual and lower ranking staff.

Dubai Entry and Residence

The Naturalization & Residency Department (DNRD) is the only administrative authority responsible for issuing visas to foreigners wishing to enter the UAE. The visas issued by the Department differ in accordance with the purpose of the visit of the foreign visitor.

Citizens of GCC countries (Gulf Cooperation Council: Saudi Arabia, Kuwait, Bahrain, Qatar and the Sultanate of Oman) and British nationals with the right of abode in the UK do not need visas to enter the UAE. GCC nationals can stay more or less as long as they like. Britons can stay for a month and can then apply for a visa for a further two months.

The DNRD issues different types of visas, which are listed below.

1) 96 hour visa:

* Issued upon arrival at the airport

* Airline sponsored only

* Applicants should have onward booking

* Should have a minimum of 8 hour transit break

2) Visit visa:

2.1 In case of Personal sponsorship:

* Fees: Dhs 100

* Entry permit application form with completed typed data

* Original Marriage certificate and copy of it, in case of wife sponsorship

* Salary Certificate; The monthly salary should not be less than Dhs. 4000 in case of wife

* sponsorship, and Dhs. 6000 in case of first relatives sponsorship.

* Copy of the Sponsor passport

* Copy of the Sponsored passport.

2.2 In case of Establishments sponsorship:

* Fees: Dhs 100

* Entry permit application form with completed typed data

* Establishment card and copy thereof

* Copy of the Sponsored passport.

2.3 Renewal:

* Fees: Dhs 100

* Original Entry Permit.

2.4 Extension:

* Fees: Dhs. 500

* Original Entry permit

* Extension application form

* Original sponsored passport.

3 - Transit visa

* Fees: Dhs. 120

* Establishment card

* Entry Permit Application form

* Copy of Sponsored passport.

4 - Tourist visa

* Fees: Dhs. 100

* Establishment card

* Statement of tourists data

A Multiple Visit Visa can be granted after a normal visa has been issued and used, and are an option for business visitors who are frequent visitors to the UAE and who have a relationship with a reputable company in the UAE. Valid for six months from date of issue, each visit must not exceed 30 days in total. This visa costs Dh1000 (2006). The visitor must enter the UAE on a visit visa and obtain the multiple entry visa while in the country.

German citizens (both tourists and business visitors) may apply to the UAE embassy in Germany for one or two year multiple-entry visa. No sponsor is required. The maximum duration of stay should not exceed three months a year. The visa fee is Dh1500 (2006).

US citizens may apply to the UAE embassy in the US for one to ten year multiple-entry visas. A sponsor is required and the visa will be granted free of charge. The maximum duration of stay should not exceed six months per visit.

A Residence Visa stamped on a passport proves the legal residence of an expatriate in the country. This visa is given to workers who have obtained work permits or for relatives living with them permanently, and additional documentation is required.

In June, 2003, the government announced that it planned to allow expatriate residents to move freely among GCC countries by the end of the year, something which in any case became possible with the establishment of the GCC Common Market.

In 2003, Dubai, and the United Arab Emirates (UAE), of which it forms a part, started making a determined push to increase the participation of locals in the work-force under a policy known as 'emiratisation'.

Just 30% of the Dubai Internet City's (DIC) workforce at the time were UAE nationals. "The DIC also has a strategy to increase the percentage of national workers," said Dr Omar bin Sulaiman, CEO of the City.

"The underlying objective behind such laws and restrictions is to create a favourable work environment in the private sector for UAE national employees, that will positively affect their productivity and improve their attitude towards working in this important sector," Matar Al Tayer, UAE Minister of Labour and Social Affairs, explained at the inauguration of a four-day Careers UAE 2003 exhibition at the time.

In May 2005, however, it emerged that there was some dissatisfaction with the policy, with employers arguing that nationals are being parachuted into positions for which they are not qualified.

Only 17% of the 4 million people living in the UAE are nationals, and only 40% of these have college degrees.

Businesses reportedly complained that nationals are unhappy with entry-level jobs like reception or office help positions and consider this type of work beneath them.

However, in June 2005, the body responsible for administering the emiratisation program, Tanmia, warned that the UAE will deny work permits and entry visas to firms that do not comply with their prescribed quotas.

The Board of Trustees of the National Human Resources Development and Employment Authority, chaired by Dr Ali bin Abdullah Al Kaabi, Minister of Labour and Social Affairs, decided at a 2005 meeting to step up measures to deny firms not complying with the prescribed emiratisation quotas.

Studies conducted by Tanmia suggested that in the banking sector only seven of the banks operating in the UAE had achieved their 2004 Emiratisation target of 4%; that over 19 banks registered a gap of over 10% between the targeted and realised levels; and that the overall emiratisation percentage realised by the sector was 27.6%.

In the insurance sector, only one out of the 46 operating firms achieved the prescribed quota (5%) and that the nationals accounted for only 5.3% of the sector's overall work force in 2004. Practical steps were agreed upon in the meeting to accelerate implementation of the Cabinet resolutions in order to reverse the modest results.

The main focus of Tanmia's meeting was on Emiratisation in the various sectors of the UAE economy. The meeting discussed progress of implementation of the Cabinet's resolutions on 2005 employment quotas in the private sector including banking sector (4 per cent), insurance companies (5 per cent) and in trade companies employing 50 workers or more (2 per cent), and on the full Emiratisation of executive, administrative, clerical positions (and business ownership) of travel and tourism, manpower supply and real estate agencies.

In late 2005 and early 2006, it emerged that the Labour Ministry's PR Officers' campaign had imposed 1,200 PROs on larger companies in the Emirate.

Humaid Bin Deemas, assistant labour undersecretary at the Labour Ministry, stated at the time that as of February 6, 2006, more than 1,200 nationals now worked as Public Relations Officers (PRO), tasked with handling company transactions with government bodies.

Most of the nationals were hired after the Labour Ministry enforced a decision from January 2 that the 2,700 companies with more than 100 workers had to hire a national PRO. Companies that do not are unable to process their transactions at the Ministry.