DubaiAbuDhabi

9 Chapter Labor

    • Working environment

      The population of UAE with Dubai / Abu Dhabi is on an increasing trend year by year, and it is about 920,600 in 2012. Although it is on the upward trend, the population is still small, so there is no big appeal in the market. However, as merit as a tax avoidance area is very large, there are many cases where companies establish investment bases.
      Also, despite the small population, economic growth is remarkable, it seems that the conversion from primary industries such as petroleum to tertiary industries such as finance and tourism has been successful.
       
      The population is particularly prominent among men from 20 to 40 years old (see chapter 1 "Basic knowledge"), because foreign workers in the vicinity of work are flowing into UAE domains. As many foreign workers are supporting the UAE economy in this way, it is a challenge that you can not cover the economy in your country.
      In Dubai, many immigrants, including India and Pakistan, live, while the proportion of UAE citizens is low, it is an international city. Although the population of UAE itself is expected to increase, it is estimated that the population of UAE citizens will gradually decrease, so it is expected that the proportion of immigrants will continue to increase.
      Companies entering the business need to understand this situation well and devise employment plans.
       
       
      ■ Labor force population
      Looking at the labor force population in Dubai, it is about 1.3 million people in 2011 statistics. Moreover, most of them are workers other than their own citizens of Dubai, and the labor force of their own people in Dubai is an extremely immigrant society with about 50,000 people.
       
      ■ Unemployment rate
      The UAE unemployment rate in 2011 is 4.6%, which is the highest since we started the statistics. The lowest level will be 1.2% of 1985. Because UAE is always in a labor shortage, it is characterized by its low unemployment rate. Because UAE's labor shortage is constant, it is unlikely that the unemployment rate will increase significantly in the future.
       
      ■ Wages
      Since UAE has achieved economic development with the benefit of soaring crude oil, average wage has already been set high. Even a worker in the manufacturing industry (general worker) can not say that it is a cheap workforce by about 200,000 yen per month (as of 2014) on a Japanese yen equivalent basis. Therefore, it is the greatest benefit to invest as a tax avoidance area, as a regional headquarters in the Middle East, not as a country investing for labor.
      There is no minimum wage provision (as of September 2013)
      In 2012 UAE 5.2% wage rose. In 2013, 5.1% wage rose. The breakdown is as follows.
      Looking at the rate of increase in wages by type of industry, you can see that finance is the leader in society as well. It is believed that the government's efforts to promote the oil refinery route have resulted in such a result, and it is no doubt that finance will lead the UAE in the future.
       
      Since the wage rise rate of UAE as a whole is stable at the 5% level, the company side is making it easy to set up an employment plan.
      The UAE Department of Labor has decided to classify workers into three functions and has set minimum wages for each final academic background.
       
      ■ Employment obligation for local people In the following industries there are employment obligations of locals and we must raise the percentage of local people every year.
       
      · Wholesale, retail etc. (50% or more employees) (2% per year)
      · Insurance industry (5% per year)
      · Banking business (4% per year)
       
      Even if you violate the employment obligation of the local people, there are no penalties in particular, so there are many companies that do not protect them. Furthermore, there is no obligation to employ this local person in special economic zones such as Jebel Ali Free Zone.
       

    • Labor dispute

      Individuals will use the non-trial dispute resolution means (ADR) or the court as a means to solve labor-management problems. On the other hand, in the case of group dispute, if the parties can not resolve each other, follow the following procedure.
       
      1 The worker makes a written complaint and sends it to the employer and the labor bureau
      2 Employers respond within 7 days. Also send a copy of it to the Labor Office
      If the problem is not resolved by 3 and 2, the Labor Bureau will mediate
       
      The Labor Bureau has a mediation committee, and its decision is binding. If you are dissatisfied with the decision you can appeal to the highest mediation committee.
       
      In Dubai the Amicable Settlement of Disputes Center is located and encouraged to resolve the dispute at the center before it becomes lawsuit at the mediation committee. Jurisdiction of this center is limited only when it falls into one of the following three as a rule in principle.
       
      · The amount of the dispute is 20,000 dirham or less
      · Dispute over division of shared property
      · Parties have explicitly agreed to mediate to the center
       

    • labor law

      The labor law of UAE is prescribed by various resolutions and orders of the Supplementary Law, including the Federal Law No. 8 (1980) revised by the UAE Labor Law. In UAE these labor laws are the norm and will of course be applied in Dubai and Abu Dhabi as well. However, in some Special Economic Zones / Free Zones there are laws that apply only to that location.
      The UAE Labor Law consists of all Chapter 12 Section 193, covering all matters concerning labor. I will look at UAE labor law below.
       
      According to the UAE Labor Law, labor and management have an obligation to sign an employment contract. In principle, you must create two contracts and keep one copy for each employer and worker. However, there are cases where it is not necessary to conclude an employment contract in writing if it is a means approved by the UAE Labor Law.
      However, if you sign an employment contract with a foreign worker, you must use the document that the employer applied and approved by the Labor Bureau.
      Employment regulations oblige companies to employ more than 15 workers. In addition, when employing more than five workers, there is an obligation to create files for individual workers.

    • Employment contract

      The document based on the UAE Labor Law is said to be described in Arabic, but in fact the two languages, English and Arabic, are used.
      The essential items of employment contract are as follows.
       
      · Employment start date
      · Job category
      Work place
      · Period (Temporary, indefinite)
      · Remuneration
       
      4 years including the renewal of the contract is made the longest, and in the case of renewing the contract for more than 4 years, it is considered to have signed an indefinite labor contract. In other words, due to renewal of a temporary labor contract every four years, indefinite labor contract can not be avoided.
       
      ■ Termination of employment contract
      Compensation and retirement allowance will be paid to workers when employment contract is over.
       
      According to the provision of Article 120 of the Labor Law, in the case of dismissal due to reasons attributable to workers' responsibility, it is said that they do not have to pay the above compensation and retirement allowance.
      Regarding retirement of indefinite workers, both labor and management must notify in writing 30 calendar days in advance. Instead of warning, you can pay reparations or you can order home wait by paying unpaid remuneration.
       
      [Obligation of returning foreign workers]
      Employers are obligated to return this worker to their home country when employment contracts for foreign workers are completed. However, it excludes in the following cases.
       
      · Worker's resignation
      · Workers have already changed jobs
      - Dismissal due to reasons attributable to workers' responsibility If this is not the case, even in the trial period, employers are obliged to dismiss for just cause.
       
      ■ Worker individual file
      As mentioned earlier, when employing more than five workers, we must create a worker individual file containing the following items.
       
      · Name
      A job
      Age
      · Country of Citizenship
      · residence
      · marital status
      · The date of adoption
      · Remuneration
      · Penalty
      · medical history
      · Employment release date and reason
      · Vacation card (records on annual paid vacation, sick leave, other vacation)
       
      ■ Employment rules
      The employment regulations need to include the following items.
       
      · Working hours per day
      · Week holiday · Legal holiday
      · Prevent and countermeasures against disasters in business
       
      Since the employment regulations must be posted in a prominent place in the workplace, there are not many items to be stated. In order to apply the employment rules, it is necessary to notify the Labor Department in advance and obtain approval within 30 days.
       
      Trial period
      It is possible to have a trial period of 6 months or less. During the trial period, you can cancel the contract from any of labor and management, and employers do not need to pay benefits, retirement allowances, etc.
       
      ■ Change period
      If a worker leaves the current employer and changes to another employer, the worker is forbidden to change his / her job for six months after retirement according to the system established by the Ministry of Labor. It is a provision established because there are many workers who quit in a short term. In principle, this term is not applicable in the following cases.
       
      · There is agreement between labor and management
      · If the number of years of service exceeds 2 years under the same employer
       
      In addition, when the employer violates an employment contract or when it is caused by a change within a company group, the above labor-management agreement becomes unnecessary.
       
      Statutory working hours
      Legal work hours for workers over the age of 18 are stipulated up to 8 hours a day (excluding 1 hour break), up to 48 hours per week. In general, there are many companies that employ 40 hours / week labor with 5 days a week work, but under the UAE Labor Law it is possible to have six days a week work. Also, it is necessary not to allow more than 5 hours of continuous work continuously and to take a break in between. Also, when engaging in retail, eating and drinking, security, extension is possible up to 9 hours a day. The statutory holiday will be Friday.
      Since legal work hours are reduced by 2 hours during Ramadan, if you work for more than 6 hours, that overtime will be overtime work.
       
      ■ Overtime work, midnight labor
      Regarding overtime work, you will be obligated to pay offtime over 25% of normal working hours wage.
      Also, if you want to work in the time from 21 to 4 o'clock, you are deemed late-night labor and you have to pay overtime allowance of 50% or more of normal working hours wage. In addition, overtime work exceeding 2 hours a day is prohibited.
      Most workers are within the scope of overtime work as exemption from overtime work is limited to those who have a limited authority of directors and others.
       
      ■ Holiday labor
      Legal holidays are Friday and weekends are Friday and Saturday. In order to work on Friday, you have to get a substitute holiday or pay extra wage of 50% or more. Even in this case, I can not work on Friday for 2 consecutive weeks. However, it is not applicable for day laborers.
      If you want to work on a public holiday of UAE, you need to choose one of the following two calculation methods and pay salary.
       
      ① normal daily + 1 day off instead + 50% extra surcharge
      ② Normal daily amount + extra 150% or more
       
      If the daily amount is 10, you will pay salary of 10 + 15 days off + 1 day + 5, 2) 10 + 15.
       
      ■ Annual paid vacation
      Paid vacation is granted to workers who worked for more than 6 months.
      For undigested annual paid holidays, you must either carry over in the following year or purchase it at the end of your employment contract. Under UAE's case law, paid carryforward is valid for up to two years. If it exceeds this, it is necessary to buy it during the employment period.
       
      ■ Public holiday
      Public holidays set by UAE are paid and need to pay wages.
      When public holiday and weekend (Friday, Saturday) overlap, measures such as transfer holidays are not legalized.
       
      ■ Sick leave vacation
      If a worker who worked continuously for three months or more gets sick or injured, he / she can acquire an injured leave of up to 90 days (even if it is not continuous) yearly. Payment of salary during that time is as follows.
       
      · Full payment of wages for the first 15 days
      · Half price for the next 30 days
      · After that (maximum 45 days), the dismissal during the period of unpaid injury will be invalid, but if you can not recover the injured vacation for 90 days you can be dismissed.
       
      ■ Pilgrimage vacation
      Employers must give pilgrimage leave called Haj once to workers during the employment period. It is unpaid vacation, maximum 30 days.
      Hajj is a holiday to pilgrim Saudi sacred site Mecca which starts in December in December history and is often seen in the Middle East. In the Islamic scripture Koran there is written "Those with financial strength and fitness to do once in a lifetime", but the Hajj pilgrimage is not an obligation.
       
      ■ Bonuses
      In general, it is said to be 1.5 to 2.0 months, but there are companies that do not have bonuses because there is no obligation on the part of the company to pay.
       
      ■ Regulations on female workers
      In principle, women are prohibited from working between 22 o'clock and 7 o'clock. However, application is excluded in the following cases.
      · emergency
      · I have a responsible position such as a managerial position
      · Engaged in medical services
       
      ■ childbirth childcare leave
      If the length of service is 1 year or more, you can obtain paid leave for 45 days before and after childbirth. If it is less than 1 year, you can get a vacation of 45 days before and after giving birth, but payment is half price.
       
      If you are suffering from injury or illness due to childbirth, you can get unpaid leave for up to 100 days.
       
       

    • Social security system

      As a premise of UAE's social security system, there is no obligation to join social insurance other than UAE citizens. Therefore, the matters described in this section will be the social security system required for hiring UAE citizens including Dubai and Abu Dhabi.
       
      ■ Retirement system
      There is no retirement system. However, if a worker who has reached the age of 65 works, he / she must obtain approval from the Ministry of Labor every year.
       
      ■ Scope of social security and premium burden rate
      The operation of social security is carried out by the Federal Pension Social Security Administration (GPSSA: General Pensions and Social Security Authority). The scope of coverage is widely covered with old-age pension, medical insurance, employment insurance, workers compensation compensation, disability insurance, prenatal / post-child allowance, housing allowance. This is intended to make the country that does not rely on foreign workers by protecting UAE citizens gently.
      UAE Federal Law No. 7 (1999) stipulates that the premium burden rate is 20%.
       
      Payment must be paid by the employer to the Federal Pension Social Security Administration on the 1st of every month.
       
      Workers' compensation compensation
      If workers are injured during work, the employer must pay as subsidies whichever is less, wage during the treatment period, or wage for six months, whichever is less. Employers are also responsible for outpatient expenses and equipment (such as crutches) for treatment.
      As a result, in case of death or serious illness, relatives can request compensation. The compensation amount is equivalent to wages for 24 months and is in the range of 18,000 to 35,000 dirhams.
       

    • Work permit for foreigners

      ■ Employment visa
      A visa is required to stay for commercial purposes or to stay for more than two months.
       
      [Acquisition procedure]
      1 Employer applies for and acquires a foreign employment permit to the Ministry of Labor
      2 The worker himself acquired an employment visa (Employment Visa) at the UAE embassy in Japan
      3 After entering the country with employment visa, obtain health certificate from Health Department
      4 Resident Visa * 1, Acquisition of Labor Card * 2
      * 1 Issued and obtained from Dubai Naturalization and Residency Department (DNRD)
      ※ 2 Issued and obtained from Ministry of Labor
      However, for companies that are included in the free zone for both ※ 1 and ※ 2, they will be issued in that free zone
       
      Work Permit
      If a foreigner works in UAE, it is necessary to obtain a work permit. The validity period depends on conditions such as whether or not the work place is a free zone, but it is two or three years. You can also update it.
       
      [Required documents]
      · a copy of passport
      · Photo
      · University certificate of graduation (notarized by UAE embassy in Japan)
      · Foreign Employment License Acquired by Employer
       
      ■ Residence Visa
      In order to stay long in UAE you must obtain a residence visa
      (It is considered to be a long stay after 90 days). Validity period is 2 years, renewal is also possible. For companies in the free zone the validity period will be three years. Foreigners who own real estate called freehold (permanent ownership) will automatically have acquired a residence visa.
       
      [Required documents]
      · Application form
      · a copy of passport
      · Health certificate
      · Stay certificate documents such as company's letter of recommendation
      · Fees
      · University certificate of graduation (notarization by the UAE embassy in Japan is required as well as work permits)