Overtime Calculation under the New Labour Law in UAE
The new labour law – Federal Decree-Law No. 33 of 2021 on the regulation of labour relations – has updated the regulations for the private sector in the UAE. One of the many aspects covered in the new law includes the calculation of the overtime. The new law shall become effective for employees in the private sector in the UAE from February 2, 2022. The New law has explained the regulation on the calculation of overtime that every employee in the private sector can claim for overtime pay.
According to the UAE Labour Law, specifically Article 17 of Federal Decree Law No. 33 of 2021, the standard working hours for the private sector are defined as 8 hours per day or 48 hours per week.
However, there are certain exceptions and variations based on specific industries or worker categories, which are detailed in the Executive Regulations of the Labour Law.
- The time spent commuting to and from work is not counted as working hours for most workers, unless specified otherwise in the Executive Regulations.
- If a worker has multiple employers, they cannot be required to work beyond the agreed-upon hours without written consent.
- In cases of remote work, specific working hours should be established by the employer.
- Workers are entitled to breaks if they work for five consecutive hours, with breaks lasting at least one hour. These breaks are not considered part of the working hours.
How is Overtime calculated as per New Labour Law?
As per the Article 19 of the law on Overtime calculation:
- The employer may employ the worker for additional working hours, provided that they do not exceed two hours a day, and the worker may not work more than such hours unless according to the procedures and conditions specified by the Executive Regulations of this Decree-Law. In any event, the total working hours shall not exceed 144 hours in three weeks.
- If the work circumstances require that the worker be employed for hours exceeding the ordinary working hours, such extended time shall be deemed overtime for which the Worker shall be paid his basic wage for his normal hours of work plus a supplement of at least 25 per cent of that wage.
- If the work circumstances require that the worker be employed for extra hours between 10pm and 4am, the worker shall be paid his basic wage for his normal hours of work plus a supplement of at least 50 per cent of that wage. This paragraph shall not apply to workers by shifts.
- If the work circumstances require that the worker be employed on the rest day specified in the employment contract, or the internal work regulations, he shall be compensated with a substitute rest day, or be paid his basic wage for his normal hours of work plus a supplement of at least 50 per cent of that wage.
- The worker may not be employed more than two consecutive rest days, except for the daily workers.
Following categories shall be exempted from the provisions relating to the maximum working hours:
Position at work:
- The chairpersons and members of the boards of directors.
- The persons occupying supervisory positions if such positions vest in them the powers of the employer.
- The crews of naval vessels and the seafarers who enjoy special service conditions due to the nature of their work.
- Those engaged in work which is required by reasons of technical nature to be carried on continuously by a succession shift, subject to the condition that the average working hours do not exceed (56) hours per week.
- The preparatory or complementary works that should necessarily be carried out beyond the time limits laid down for the general working of the establishment.
How much compensation for working on Public Holiday in UAE?
In accordance with Article 28 of Federal Decree-Law No. 33 of 2021, which is the new UAE Labor Law, there are provisions regarding public holidays and the compensation for private sector employees who are required to work on these designated days off.
- The employee is entitled to paid official days off on public holidays, which are determined by a Cabinet resolution.
- If a worker must work on a holiday due to work-related obligations, the employer must either give him an additional day off for each holiday-related day worked, or pay him the regular rate of pay for that day plus at least a 50% increase over that day’s base pay.
It is crucial to keep in mind that before the compensation can be applied to an employee, a number of requirements must be satisfied.
Article 28 of UAE Labour Law No. 33/2021 is applicable to all employees – regardless of categories or grades – provided that the employer requested the employee to work or the work requirement necessitates the employee, with permission, to work during the public holidays.
How do I file a Labor dispute?
The Ministry of Human Resources and Emiratization (MOHRE) is the best place to go if you’re a worker in the UAE and want to learn more about your rights under UAE labor law or complain about the pay you receive.
Employer-employee relations are managed and regulated by MOHRE in the UAE, and any conflict between the two parties may be escalated with the authority for a resolution based on the UAE Labour Law.
You can use any of the following channels to complain about your employer:
1. Dial the Ministry’s emergency number at 800 60.
2. Get the MOHRE app and submit a work complaint.
3. Go to www.mohre.gov.ae and click the “File a Labor Complaint” option.
If you select the second or third option, you will have to establish an account. Your passport information and work permit (labor card) number are required for this.
An attorney from the Twa-fouq center will contact you once you make a complaint and attempt to resolve things amicably in the first 72 working hours. An employee does not charge a fee for this procedure.
Frequently Asked Questions FAQs on Overtime as per New Labour Law
How is overtime calculated as per UAE New Labour Law
Regarding overtime, employers can ask workers to work extra hours, up to a maximum of two hours per day. If the nature of the work necessitates working beyond the regular hours, workers are entitled to additional pay, which is their normal working hours’ remuneration plus 25% (increasing to 50% for overnight work between 10 pm and 4 am). However, this rule does not apply to shift workers.
If circumstances require a worker to work on their scheduled day off, they should be provided with a substitute rest day or receive additional pay equivalent to their normal working hours’ remuneration plus 50%.
What is the working rate for public holidays in UAE?
Employees in the UAE are entitled to paid official days off on public holidays, which are determined by a Cabinet resolution. However, if an employee is required to work on a holiday due to work-related obligations, the employer must compensate them either by providing an additional day off for each day worked or by paying them their regular rate of pay for that day, along with a minimum increase of 50% over their base pay.
What is the new overtime law in UAE?
According to the Labour Relations Law and its regulations, the UAE Ministry of Human Resources and Emiratisation (MoHRE) has announced that overtime work is permitted, with a maximum limit of two hours per day. It is important to note that the total number of working hours should not exceed 144 hours within a three-week period.
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