Non Fixed Term Contract Template for the United Arab Emirates

A Non Fixed Term Contract is the standard employment agreement for permanent positions in the United Arab Emirates, establishing an ongoing employment relationship without a predetermined end date. Under UAE Federal Decree-Law No. 33 of 2021, this type of contract is required for all permanent employees and must include specific mandatory provisions to ensure legal compliance and protect both employer and employee rights.

When do you need this document?

You need a Non Fixed Term Contract when hiring permanent employees in the UAE mainland, whether for full-time or part-time positions. This applies to all permanent roles from entry-level positions to executive appointments, across all industries and sectors. Unlike fixed-term contracts that have specific end dates, non fixed term contracts are designed for ongoing employment relationships where the employer intends to maintain the position indefinitely. The contract is also required when converting temporary or fixed-term employees to permanent status, ensuring proper documentation of the changed employment relationship.

Key legal considerations

Several critical legal elements must be included in your Non Fixed Term Contract to ensure UAE law compliance. The probation period cannot exceed six months, during which either party can terminate with one day's notice. Notice periods for termination after probation vary based on employment duration: 30 days for employment under five years, 60 days for five to ten years, and 90 days for over ten years. Working hours are limited to eight hours per day and 48 hours per week, with overtime compensation required beyond these limits. Annual leave entitlements start at 30 days per year, increasing to 45 days after five years of service. End of service gratuity calculations must follow the statutory formula: 21 days' salary per year for the first five years, then 30 days' salary per year thereafter. The contract must specify the employee's basic salary, allowances, and benefits structure clearly to avoid disputes.

Legal requirements in United Arab Emirates

UAE Federal Decree-Law No. 33 of 2021 and its implementing regulations establish strict requirements for employment contracts. All contracts must be in Arabic, though English translations are permitted for clarity. The contract must identify both parties with full legal names, addresses, and relevant identification numbers including Emirates ID for employees. Cabinet Resolution No. 1 of 2022 requires specific clauses covering work location, job description, salary details, and working hours. Ministerial Resolution No. 27 of 2022 mandates that contracts include provisions for work permits and visa sponsorship where applicable. The contract must comply with UAE social security laws, including registration with the General Pension and Social Security Authority for UAE nationals. All disciplinary procedures must align with UAE labor law, and any restrictive covenants such as non-compete clauses must be reasonable in scope and duration to be enforceable.