A recent amendment to Article 54 of the United Arab Emirates’ Labor Law No. 33 of 2021 (“UAE Labor Law”) has significantly altered the method of resolving individual employment disputes before the Ministry of Human Resources & Emiratisation (“MoHRE”), enhancing MoHRE’s authority in specific scenarios.

Originally, under Article 54, parties involved in employment disputes were obliged to first seek an amicable resolution through MoHRE. If MoHRE failed to resolve the dispute within 14 days, the case would then be referred to the competent court.

The amendment, however, grants MoHRE increased powers. Now, MoHRE’s decisions in disputes involving amounts not exceeding AED 50,000, or in cases related to non-compliance with MoHRE’s prior amicable settlement decisions (irrespective of the dispute’s value), will be considered final and enforceable as an executive bond.

Should any party disagree with MoHRE’s decision, they must appeal to the competent court of appeal within 15 days of receiving the decision. The court of appeal is mandated to schedule a hearing within three business days and issue a ruling within 15 business days of the case filing. This ruling will be final, superseding MoHRE’s decision.

For disputes involving amounts over AED 50,000, where no prior decisions have been issued by MoHRE, the original settlement mechanism remains. MoHRE will attempt an amicable settlement within 14 days, failing which the case will be referred to the competent court. Upon referral, the court is required to schedule a hearing within three days.

In summary, this amendment to the UAE Labor Law, effective 1st January 2024, strengthens the resolution process for individual employment disputes by vesting additional authority in MoHRE. It is important to note that the competent courts will not accept cases that bypass the aforementioned settlement mechanisms. This change is expected to have a substantial impact on how individual employment disputes are managed in the UAE, emphasizing a more streamlined process with increased responsibilities for MoHRE.

As these legal changes can have significant implications for businesses and employees alike, it is crucial to understand and navigate these amendments accurately. At GLA & Co, we specialize in providing expert legal advice and assistance in labor law matters, including the latest amendments and their practical implications.Our team of experienced legal professionals is well-versed in UAE labor law and can offer comprehensive support in understanding and complying with these new regulations. We can assist in dispute resolution, representation in MoHRE proceedings, and legal counsel on matters related to the amended law.

Authors: Yousef Al Amly, Partner, and Habiba Wahdan, Associate.

For further information, please contact Alex Saleh (alex.saleh@glaco.com) and Yousef Al Amly (y.alamly@glaco.com).