Even though the scope of the New Law (Federal Decree-Law No. 33 of 2021) remained the same, its objectives were clearly identified to attract and maintain the workforce, while enhancing the flexibility and sustainability of the labour market. As a result, a broad range of new definitions were introduced, in addition to those included in the Old Law (Federal Law No. 8 of 1980), to help explain and achieve its objectives. Similar to the Old Law, the New Law does not apply to federal and local government employees (who are subject to the provisions of the Civil Service Law).

The New Law comes with significant changes to the labour regulations and rules that have long been applied in the UAE. In the following piece we will be briefly outlining the key changes introduced by the new Labour Law:

1. Equality and Anti-Discrimination

Whether it was under the Old Law’s provisions, or subject to the provisions of the New Law, equality and anti-discrimination within the workforce is strictly prohibited in the UAE. There shall be no discrimination between employees based on race, color, gender, religion, nationality, social origins, or disability. The New Law further expands on the anti-discrimination provisions and provides more protection to working women by clearly stipulating that a woman employee shall earn a wage that is similar/equivalent to a man employee in case she performs similar work or another work of equal value.

2. Introduction of New Work Models

A key change the New Law is the introduction of new and various “work models”, allowing the labour market to be diverse and creating more opportunities for employment in the UAE. The adoption of new work models also allows to achieve flexibility for employees. The new work models introduced are:

• Part time work model

This model allows the worker to work for one or more employers for a specified number of working hours/days per day/week.

• Temporary work model

This model allows the worker to work for a specified period or to focus on a particular job that ends upon completion.

• Flexible work model

This model allows for the change of working hours or days based upon the change in the volume, conditions or requirements of work and the economic and operational variables of the employer.

• Full-time work model

This model allows the worker to work for one employ, for a full day and on the specified working hours during business days.

3. Employment Contracts

Significant changes have been made to indefinite employment contracts under article 8. Open-end contracts are no longer permitted. Employment contracts shall be concluded for a specific period not exceeding three years and it is permissible, by mutual agreement between the parties, to extend or renew this contract for a similar or shorter period, one or more times.

Furthermore, In the event of an extension or renewal of the contract, the new period(s) shall be deemed to be an extension of the original period and shall be added thereto   when calculating the    Worker's continuous service period. And if both parties continue to implement the contract after the expiry of its original term or the expiry of the agreed-upon work without express agreement, the original contract shall be deemed to be impliedly extended with the same conditions stated therein.

4. Probation

Clauses 3 and 4 of Article 9 Probation Period have established a new obligation on the employee and their future employer in the following cases: If the worker wishes to move during the probation period to work for another employer in the state, he must notify the original employer in writing within a period of not less than one month of the date of his desire to terminate the contract. If agreed otherwise, the new employer shall compensate the original employer for the cost of recruiting or contracting with the worker. If the foreign worker wishes to terminate the employment contract during the probation period to leave the state, he must notify the employer in writing at least fourteen (14) days before the date specified for the termination of the contract. And if he wishes to return to the state and obtain a new work permit within three (3) months from the date of leaving, the new employer shall pay the compensation stipulated in Clause (3) of this Article, unless agreed otherwise between the worker and the original employer. "

5. Non-Compete Clause

Another landmark of the law is Article 10, the Non-Competition Condition. The previous law didn't have a similar clause, making it new to the UAE labour market. If an employee has access to the employer's clients and secrets due to the employee's nature of work, the employer shall include the non-competition clause in the employee's contract after the termination of the contract. The non-competition clause prohibits the employee from participating in any competing project with the employer in the same industry for two years. The clause must state time, place, and work to protect both parties' interests. However, if the employee terminates the contract due to a violation of the provisions of this decree, the non-competition clause is deemed null.

6. Maternity

Changes have been made to maternity leave in Article 30. Female workers are entitled to sixty days, the first 45 days with full pay and the following 15 days with half pay. After using her maternity leave, the female worker may take 45 consecutive or intermittent days off without compensation. If the reason for leave is an illness suffered by her or by her child, it is given that she provided a medical certificate issued by the medical authority. Furthermore, if the female employee gives birth to a sick or disabled child, she is entitled to thirty days of leave with full pay and can extend that period by another thirty days without pay.

7. Judicial Fees

Unlike Article 5 of the repealed law, Article 55 Exemption from Judicial Fees of the new law states the following: "Labour lawsuits shall be exempted from judicial fees at all stages of litigation and execution, as well as requests submitted by workers or their heirs whose value does not exceed one hundred thousand (100,000) AED."

8. Adjustment of Status

Finally, Article 68 enforces the rectification of indefinite-term employment contracts concluded under Federal Law No. 8 of 1980. Employers must convert indefinite-term employment contracts to fixed-term employment contracts within one year as of the date of enforcement of Decree No. 33 of 2021. The end of service gratuity may be calculated under the indefinite term employment contract provisions stipulated in Federal Law 8 of 1980.