UAE payroll FAQ 2026: 20 most-asked questions from employers.

WPS and salary questions

• Q1: What is the WPS deadline? — 15 days from the agreed pay date in the employment contract. Not from the calendar month start — from the contractual pay date.
• Q2: What if we have a legitimate payroll delay due to a bank issue? — MOHRE does not automatically waive WPS penalties for bank delays. Document the bank error (statement from the bank) and file a MOHRE explanation immediately. Proactive communication reduces (but does not eliminate) penalty risk.
• Q3: Can we pay salaries via cash for some employees? — No. WPS requires electronic transfer through an approved WPS agent. Cash payment — even on time — is a WPS violation.
• Q4: Our employee doesn’t have a UAE bank account — what do we do? — Open an exchange-house WPS account for them or help them open a bank account before their first pay date. Most UAE banks open accounts with just an Emirates ID and employment visa.

Gratuity and final settlement questions

• Q5: Does an employee who resigns get gratuity? — Yes. Since February 2022, employees who resign after completing 1 year receive full gratuity (21 days/year for years 1–5). The old graduated reduction for resignation was abolished.
• Q6: Does gratuity include housing allowance? — No. Gratuity is calculated on basic salary only. Housing, transport, and variable pay are excluded.
• Q7: We dismissed an employee for misconduct — do we owe gratuity? — Not if the dismissal is for a valid Article 44 gross misconduct ground (fraud, assault, intoxication, etc.). Document the grounds formally. If the dismissal reason is disputed, assume gratuity is owed until a court confirms otherwise.
• Q8: When must the final settlement be paid? — Within 14 days of the last working day. Includes gratuity, unused leave cash-out, notice pay (if not worked), and any unpaid salary.

Leave and working hours questions

• Q9: Can we make employees forfeit unused leave? — No. Accrued annual leave cannot be forfeited — unused leave must either be taken or cashed out at the basic daily rate. Attempting to forfeit leave is an MOHRE violation.
• Q10: Do we need to pay double for working on a public holiday? — Employees required to work on a public holiday are entitled to an additional day’s pay or a substitute rest day. If neither is provided, the employee can claim the additional pay via MOHRE.
• Q11: How many hours can an employee work per day during Ramadan? — 6 hours (standard 8 hours minus the mandatory 2-hour Ramadan reduction). Any work beyond 6 hours is overtime.
• Q12: What is the sick leave entitlement? — 90 days per year: first 15 days full pay, next 30 days half pay, last 45 days no pay. Medical certificate required.

Emiratisation, contracts, and other questions

• Q13: We have 52 employees — are we subject to Emiratisation quotas? — Yes. The 50-employee threshold applies to the total headcount. Confirm your exact target on the MOHRE Tasheel portal.
• Q14: Can we extend a probation period beyond 6 months? — No. 6 months is the statutory maximum. An ‘extension’ is a new probation period and is not permitted — the employee’s status converts to full employment.
• Q15: Our employee wants to leave without working the notice period. Do we owe them anything? — If the employee leaves without working the agreed notice, the employer can deduct notice salary from the final settlement. If the employee’s visa must be cancelled, do so within 30 days regardless.
• Q16: GPSSA — which employees must be enrolled? — UAE nationals and GCC nationals employed in the UAE. Expatriate employees are not enrolled. Enrol UAE nationals from their first day of employment.
• Q17: Can we include a non-compete clause in an employment contract? — Yes, if limited to 2 years, reasonable geography, and the employee has access to confidential information. Overly broad clauses are voided by UAE courts.
• Q18: What is the penalty for employing someone without a work permit? — AED 50,000 per undeclared employee. Plus potential criminal liability and business licence suspension.
• Q19: Must contracts be in Arabic? — For MOHRE registration and labour court enforceability, Arabic is required. Bilingual (Arabic/English) contracts are best practice.
• Q20: What MOHRE filings must we make for a new employee? — Work permit application within the first week, MOHRE labour contract registration, GPSSA enrolment (if UAE/GCC national), and WPS agent enrolment for the new employee’s bank account.