If you’re planning on entering the UAE market you must understand the COVID-19: UAE Free Zone Labour Regulations Update. Since the beginning of the pandemic, the UAE government established several guidelines for employers and since it has been over a year it’s necessary to know what has changed and what remains the same.
In this article, you’re going to learn everything you need to know about the laws and regulations your business should follow. Particularly, if you’re working in a Free Zone or you’re planning on setting up your business in there, it’s essential to be aware of this. Let’s observe:
- COVID-19: UAE Free Zone Labour Regulations Update you should know
- What are the applicable laws for Free Zones?
- What are the updates for the majority of Free Zones?
- Which guidelines should the Dubai International Financial Center follow?
- What are the guidelines for the Abu Dhabi Global Markets?
- Which guidelines are implemented in the Dubai Multi Commodities Center?
- What are the regulations in terms of Visa processing?
- How can Connect FZ help you prepare your business to enter the UAE market?
1. COVID-19: UAE Free Zone Labour Regulations Update you should know
As a business owner, you should learn about COVID-19: UAE Free Zone Labour Regulations Update. The pandemic has affected almost the entire world to the extent that countries had to establish several regulations to ensure the wellness of their citizens.
For this reason, if you’re planning on entering the UAE market, you must be aware of all the rules you must follow. Last year, UAE Authorities established several guidelines that employers could follow to ensure operations. But, it’s important to know if there have been any changes since it’s a major concern for businesses.
If you’re going to have a workforce in the UAE you need to comply with the local laws. For this reason, you need to be updated. Hence, you must know about several crucial aspects like the Dubai freezone Visa cost or the employment-related matters.
1.1 Why is it important to know about the update in regulations?
Businesses that are operating in the UAE or that are looking to enter this market must comply with the latest regulations in terms of the ongoing pandemic.
Perhaps you’ve considered setting up your business in the UAE and you have read the rules but you need to be aware if there are any changes. According to the UAE government, every business based onshore or in any of the Free Zones needs to comply with a specific set of regulations.
Some of the reasons why this is mandatory are the following:
- It helps employers to have a guideline to follow depending each case
- Allows to have flexible operational practices
- It’s a great way of guaranteeing the health and safety of employees
- Knowing the updates in regulations can help your business face the pandemic better
Since the economy and work practices are evolving, it’s expected to see updates in current regulations. Authorities want to ensure the operation of businesses and at the same time ensure the people’s health.
Learn more about how you can carry out the company formation process in Ajman.
2. What are the applicable laws for Free Zones?
Learning about COVID-19: UAE Free Zone Labour Regulations Update implies knowing the applicable laws that vary on each place.
In this sense, it’s important to know which laws are crucial based on the area. Some of these are the following:
- Mainland and majority of Free Zones: businesses located in these areas must comply with Federal Law No.8 of 1980 (the UAE Labour Law)
- Dubai International Financial Center (DIFC): this economic free zone should comply with the Employment Law No. 2 of 2019 (The DIFC Employment Amendment Law)
- Abu Dhabi Global Market (ADGM) Employment Regulations 2019.
- Dubai Multi Commodities Center (DMCC): businesses have to comply with the Labor Law but they also must follow the DMCC Guidelines No.1 of 2020
If you’re thinking of setting up your company in one of the many Free Zones in the UAE, you should know which ones are available and are the most suitable for your business. For this reason, it’s important to learn more about them so you can choose the best location.
Learn more about the northern Emirate Free Zones available to set up your business in the UAE.
3. What are the updates for the majority of Free Zones?
It’s important to know that the COVID-19: UAE Free Zone Labour Regulations Update are not the same for the entire territory. Since there are over 40 Free Zones in the UAE, it’s important to know which updates apply to the majority.
Some of the regulations employers in Free Zones can follow are the following:
- Remote working system: the company can implement a remote working system but needs to provide everything the workers need to carry out their tasks.
- Surplus employees: employers should register their surplus employees on the Virtual Labor Market.
- Employees unable to repatriate: those expat workers that were unable to go back to their country had to receive their allowances from the company.
The employer should follow a series of steps beginning with implementing remote working, granting paid leave, granting unpaid leave, or reducing the salary (temporarily and permanently). These had to get employees’ approval.
However, it’s important to note that depending on the Free Zone where your business is operating you may be requested to comply with additional regulations set by the Free Zone authority.
4. Which guidelines should the Dubai International Financial Center follow?
If you’re considering the DIFC Free Zone to set up your business, you should learn about the COVID-19: UAE Free Zone Labour Regulations Update for this area.
Some of the guidelines are the following:
- Emergency period: the employer may impose any measure upon the employees without the need to receive the consent. The measures are vacation leave, unpaid leave, reduced remuneration (temporarily), reduced working hours, remote working and restricted workplace access.
- Excess workforce: employers must provide a list to the Government Service Office which includes terminated employees and available to work.
- Annual leave: a great measure is the annual leave and there are several regulations to ensure it follows the law
An important aspect to note is that employers in the DIFC are encouraging employees to receive vaccination since they’re hoping to resume their operations as soon as possible.
Learn more about the Mainland Trade Licenses and all the types available.
5. What are the guidelines for the Abu Dhabi Global Markets?
In the case of the ADGM Free Zone it’s also essential to learn about the COVID-19: UAE Free Zone Labour Regulations Update.
In this place, the guidelines were almost the same as in the DIFC. The guidelines have the objective to ease and guide the process for entities and employees. Some of the measures are the following:
- Independent legal assistance: since the ADGM issued Regulations and a FAQ where they intended to make everything clear, they pointed out that in some cases it’s best to seek for independent legal assistance if the employer and the employee can’t reach an agreement.
- Temporary or permanent salary reduction: the employer may reduce the employee’s salary but if the employee doesn’t agree they have to take the matter to the courts.
- Deferring payment: an employer should pay the employee within the seven days established as pay period. However, both parties can reac an agreement of deferred payment plan as it’s allowed.
- Repatriation: since it’s not possible to leave the UAE, the employer and employee should enter into an alternative arrangement that could help them.
Basically, the employer and employee can resolve the issues between each other in the ADGM as it’s allowed. Therefore, we could say there’s some flexibility in this matter and there were no new provisions added recently.
Learn more about how to start a business in Dubai Free Zone.
6. Which guidelines are implemented in the Dubai Multi Commodities Center?
The DMCC has also important information regarding the COVID-19: UAE Free Zone Labour Regulations Update. As this is one of the most prominent areas to make business, it’s essential to know what to expect when you’re going to work here.
6.1 Remote work
Remote work isn’t going to disappear, on the contrary, is being addresses in this update. Some of the guidelines are the following:
- Employers can request their employees to work remotely
- The company should provide the necessary resources to employees if it decides to implement a remote working policy
- The company should have a confidentiality policy for remote workers
- Employers should prioritize employees that belong to special categories like pregnant women, elders, people with respiratory diseases and mothers of young children.
6.2 Reduction of salary
Authorities advised employers to apply a reduction of salary to protect their revenue. However, it’s only a temporary measure. It’s important to note that force pay cut is not allowed unless is mutually agreed and documented.
6.3 Paid and unpaid leave
Another measure to mitigate the losses for businesses is to implement paid and unpaid leave. The guidelines are as follows:
- Paid leave: it could be as long as necessary and it doesn’t require employees’ consent.
- Unpaid leave: the employer should determine the leave period and both parties have to mutually agree
In this sense, it’s very important for employers to not force the unpaid leave since it could be considered as a breach of the contract.
6.4 Employees’ rights
Although employers can get excellent solutions from implementing a remote workforce or a paid or unpaid leave, it’s important to continue respecting employees’ rights.
Any infringement on their access to benefits, documentations, transportation and accommodation provided by the company should remain.
Learn more about if free zone companies can work in Dubai Mainland.
7. What are the regulations in terms of Visa processing?
The UAE authorities have not only updated the Labor laws but they also have updated the Dubai freezone visa rules and regulations. It’s an important aspect for employers as many businesses are looking for hiring expats.
Some of the latest updates in Dubai freezone visa rules and regulations are the following:
- Since 5 October 2020 it’s allowed for businesses in vital sectors and government-related to receive the work permits for their employees.
- The issue of visas on arrival is still suspended
- Only essential businesses are allowed to hire employees from abroad
- Visa extensions are allowed for those who have the following visas: citizen, GCC, Expatriate Resident. However, it’s only applicable if the document expires after March 1st.
There are not any updates regarding the Dubai freezone Visa cost since there are still temporary restrictions on immigration. In this matter, it’s possible that some employees are unable to return to the country because of visa suspensions. The only thing they can do is to wait after the immigration authorities give their approval.
8. How can Connect FZ help you prepare your business to enter the UAE market?
In Connect FZ we are ready to help you navigate this difficult time we are facing due to COVID-19 pandemic. We want to help you establish your business in any of the available Free Zones in the UAE. Our team of specialist can give assistance in each step of your company formation.
We have been providing our comprehensive service to a variety of companies that are looking for opening a branch in the UAE. Our experts can help you select the best way to carry out your business and stay in compliance with the latest regulations. Whether you want to open a branch or you need assistance with your business we are here to help.
Would you like to contact Connect Free Zone to help you process the Professional License in Dubai? You can call at +971 433 166 88 or send an email to contact@connectfz.ae , and you’ll talk to one of their representatives that will gladly answer all of your questions.