UAE: Can companies delay salary due to late payments from external vendors?

Question: Can salary payment be dependent on a company getting its external payments? My Dubai-based company often delays our salaries, citing pending payments from vendors. Is that legal? If not, what action can I take?

Answer: In the UAE, an employer is obligated to pay employee’s salary/wages on the due date as per the country’s employment law. This is in accordance with Article 22 of the Federal Decree Law No. 33 of 2021 on the Regulation of Employment Relations and Article 1 (1) of the Ministerial Resolution No.(598) Of 2022 Concerning the Wages Protection System.

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“The employer shall pay the salaries or wages to its employees on their due dates in accordance with the regulations approved by the Ministry, as well as the conditions, rules and procedures specified by the Implementing Regulation hereof.”

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“Employees shall receive their wages on the first day of the month following the registered payday specified in the Employment Contract”

Further, if an employer delays the salary for more than 15 days from the due date, then it is considered a delay. This is in accordance with the Article 1 (2) of Ministerial Resolution No. (598) Of 2022.

“Employers who fail to pay wages to their employees within 15 days of the due date will be considered late, unless the Employment Contract provides otherwise.”

Further, Article 2 of the Ministerial Resolution No. (598) Of 2022 lists the actions that can be taken against an employer who fails to pay salary on time.

Based on the aforementioned provisions of law, your employer cannot legally justify delaying salary payments on the basis of delay in receiving external payments from its customers. You can discuss this with your employer and if your salary is delayed beyond 15 (fifteen) days, you may escalate the matter with the Ministry of Human Resources and Emiratisation.

Ashish Mehta is the founder and Managing Partner of Ashish Mehta & Associates. He is qualified to practise law in Dubai, the United Kingdom and India. Full details of his firm on: www.amalawyers.com. Readers may e-mail their questions to: news@khaleejtimes.com or send them to Legal View, Khaleej Times, PO Box 11243, Dubai.