Contract Between Employer And Employee Template for the United Arab Emirates

An employment contract is a legally binding agreement that defines the working relationship between you and your employee in the United Arab Emirates. Under Federal Decree-Law No. 33 of 2021, this document is mandatory for all employment relationships and must comply with strict UAE labor law requirements to ensure legal validity and enforceability.

When do you need this document?

You need an employment contract whenever you hire a new employee in the UAE, whether they are UAE nationals or expatriates. This includes full-time positions, part-time arrangements, temporary roles, and flexible work contracts as defined under Ministerial Resolution No. 43 of 2022. The contract is essential for MOHRE registration, work permit applications, and residence visa processing for expatriate employees. You also need this document when renewing existing employment relationships or converting unlimited term contracts to the new mandatory fixed-term format introduced in 2022.

Key legal considerations

Your employment contract must include several mandatory clauses to comply with UAE labor law. The probation period cannot exceed six months and must be clearly specified, during which either party can terminate with one day's notice. Working hours are limited to eight hours per day and 48 hours per week, with overtime compensation required for additional hours. You must specify the employee's salary, allowances, and benefits, ensuring compliance with minimum wage requirements where applicable. End-of-service benefits calculation must follow Ministerial Resolution No. 44 of 2022, providing gratuity based on the employee's length of service. The contract should also address annual leave entitlements, sick leave provisions, and termination procedures, including notice periods that vary based on the contract duration and employee's length of service.

Legal requirements in United Arab Emirates

All employment contracts must be registered with MOHRE within 60 days of the employee's start date for mainland companies, or with the relevant free zone authority for free zone employers. The contract must be written in Arabic, though English translations are commonly used alongside. Since 2022, unlimited term contracts are no longer permitted, and all agreements must specify a fixed duration typically ranging from one to three years. UAE nationals employed in the private sector are subject to Federal Law No. 7 of 1999 regarding pension contributions and social security benefits. The new unemployment insurance scheme under Federal Decree Law No. 9 of 2022 requires specific provisions for eligible employees. Your contract must also comply with Emiratisation requirements if applicable to your business sector, ensuring proper documentation of UAE national employment ratios.