Types of employment contracts in the private sector in the Emirates

Mohamed Shalaby - | Business

The regulations pertaining to labor relations found in Federal Decree Law No. (33) of 2021 and its revisions, which became effective on February 2, 2022, apply to employment contracts in the private sector. With the help of this law, the labor market in the Emirates will grow, flexible employment, competition, and innovation will be encouraged, the rights of employers and employees will be upheld, and the standard of services will be improved. The most common forms of employment contracts in the private sector of the Emirates, their determination, renewal, and termination procedures, as well as certain associated concerns, are covered in this article.

Types of employment contracts in the private sector in the Emirates

The UAE Labor Law provides clarifications on all forms of employment contracts in the private sector of the Emirates, with the aim of minimizing issues or disputes between the employer and employee and outlining their respective rights and responsibilities. Following is a detailed list of the many forms of employment contracts in the private sector in the United Arab Emirates, along with a comprehensive summary of the terms and conditions for each type:

Fixed-term work agreement

One of the most common forms of employment contracts in the private sector in the Emirates is the fixed-term contract. It is an agreement reached for a fixed duration of time, not to exceed two years, between the employer and the employee. The beginning and ending dates of the term, as well as any terms for renewal or extension, if any, must be included in this contract. A fixed-term employment contract cannot be terminated by either the employer or the employee without a good reason or with compensation to the other party while it is still in effect.

This contract has the advantages of protecting both parties' rights and interests while ensuring the stability of their working relationship. In addition to lowering risks and expenses, this contract makes it easier to plan and organize tasks and projects. Furthermore, by encouraging both parties to commit to particular objectives and responsibilities, this contract raises performance standards and productivity.

The term of the work contract is indefinite.


It is an agreement reached between an employer and employee that does not predetermine a time frame. This agreement must only include the period's beginning date; an expiration date is not permitted. This agreement may be terminated by either the employer or the employee at any time throughout its duration by giving the other party written notice, which may be given for a minimum of one month or a maximum of three months. In certain situations, such as those involving carelessness, retirement, injury, disability, or breach of contract, the parties may also end it without giving notice.

The most significant of these terms and conditions, which are outlined in the UAE Labor Law, is the notice period, which mandates that the party wishing to terminate the employment contract give the other party written notice for a minimum of 30 days and a maximum of three months. This type of employment contract in the private sector in the Emirates is subject to certain restrictions. The offending party shall pay compensation equal to wage for the balance of the notice term in the event that the notice period is not fulfilled.

Contract for part-time work

In the United Arab Emirates, an employee can work for a set number of hours or days in one or more establishments under a part-time employment contract, without having to commit to full-time labor. A one-year valid part-time work permit from the Ministry of Human Resources and Emiratization is required for this kind of contract.

A minimum university or institute qualification and work within the designated scientific, technical, and administrative professions and talents are requirements of the UAE Labor Law, which governs part-time employment contracts. The part-time labor contract benefits Emirati citizens, citizens of the Gulf Cooperation Council, and residents of the Emirates who are sponsored by the institution or by private individuals.

This law does not apply to those who work in the security, public, or service sectors. Flexibility, diversity, and cost savings are just a few advantages that come with a part-time employment agreement for both the business and the employee. In addition, he must deal with issues including conflicts of interest and their effects on retirement plans and insurance.

Work patterns in the UAE labor law

According to the UAE Labor Law, work patterns are a range of choices that an employee and an employer can make to structure their working relationship in a way that best suits the demands, size, and nature of the business. These trends seek to draw in the greatest talent and skills, boost labor market efficiency and productivity, and give employees a flexible and engaging work environment. Five categories of work are covered under the UAE Labor Law, which went into force in February 2022:

full-time

It means working continuously for a single employer during the whole workday without taking a break. The duration of the employment contract is set forth in writing and may be renewed or extended more than once. The employee in this kind of work is subject to a trial period that can't last longer than six months. If the non-compete clause is restricted in terms of location, duration, and kind, the employer may also include it to the employment agreement.

sporadic

Work of this sort is defined as work that is performed for a certain number of hours each day or days that have been set aside for work and approved by the employer and employee. The hourly, daily, or monthly terms of the part-time job contract are agreed upon. In this kind of job, the employee is additionally subject to a trial term that lasts no longer than three months. The employer's duties to the employee must also be reported to the Ministry of Human Resources and Emiratization.

Temporary Employment

This type of work has an implementation nature that calls for a set time frame or that begins with the task and ends when it is finished. One of the requirements for this kind of employment agreement in the Emirates' private sector is that it be signed for a duration of no more than a year. The probationary term for the employee cannot be longer than one month. The employer's duties to the employee must be reported to the Ministry of Human Resources and Emiratization.

Adaptable scheduling

Working for an employer who offers the flexibility to alter workdays or hours based on the volume of work and operational and financial factors at the company is known as flexible employment. Under this kind of contract, work is done on an hourly, weekly, or monthly basis. The employee is going to be on probation for a maximum of two months. One of its requirements is that the employer disclose its duties to the employee to the Ministry of Human Resources and Emiratization.

developing a framework for job sharing

One of the new work arrangements in the UAE's private sector is job sharing, which was made possible by Federal Decree Law No. 33 of 2021, which governs labor relations. This pattern enables multiple workers to share a single job and assign responsibilities and tasks to each other in accordance with an earlier understanding. This approach seeks to give employees greater flexibility in their work schedules and to better balance their personal and professional lives.

In summary, employment is a fundamental human right that provides a means of subsistence as well as a contribution to growth and productivity. However, there must be regulations and guidelines for labor. Instead, it requires legislative control to protect the interests and rights of both employers and employees. The most significant categories of employment contracts in the Emirates' private sector have been covered in this article. We anticipate that it will be advantageous to everyone involved in this situation.

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Mohamed Shalaby
Mohamed Shalaby
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