Understanding overtime regulations in the UAE is vital for both employees and employers to ensure compliance with the country’s labour laws. Whether you’re working late into the night or putting in extra hours during weekends or public holidays, it’s important to know the rules surrounding compensation for overtime.
The UAE Labour Law provides clear guidelines on how overtime is calculated, who is eligible for it, and the rates applicable for different scenarios. This article will help break down the intricacies of overtime pay, providing a comprehensive guide to ensure that you’re well-informed about your rights and obligations.
What is Overtime Pay in the UAE?
Overtime refers to hours worked beyond the standard legal working hours in the UAE, which are typically 8 hours per day or 48 hours per week for private sector employees. Employers may request up to two additional hours of overtime per day, which must be compensated with an increased rate of pay. Different sectors have specific rules and rates regarding overtime, which will be covered in more detail below.
Who is Eligible for Overtime Pay in the UAE?
Not all employees are eligible for overtime compensation. Certain positions, like senior and administrative supervisors, are exempt from overtime pay due to their managerial responsibilities. Additionally, workers in specific sectors such as naval ships, and marine industries, and employees in roles requiring high autonomy (e.g., senior executives) may also be excluded from overtime compensation. Shift workers in continuous operations have a distinct overtime structure, as night-time overtime rules don’t apply to them.
The Ministry of Human Resources and Emiratisation (MoHRE) provides specific guidance on which roles are exempt from overtime and resolves disputes regarding eligibility. If your role exceeds the maximum overtime hours but falls under an exempt category as determined by MoHRE, you cannot claim overtime for the additional hours worked.
Types of Overtime: Planned vs. Emergency
Overtime can be either planned or emergency. Planned overtime is scheduled in advance, while emergency overtime is due to unforeseen circumstances. For planned overtime, employees should receive their basic wage plus at least 25%. Emergency overtime worked between 10 pm and 4 am, or on a rest day, entitles employees to at least 50% of their basic wage. Continuous overtime lasting five or more hours must include a break of at least one hour, which isn’t counted towards overtime.
Overtime Calculations
Regular and Emergency Overtime Calculation
The calculation of overtime pay is based on a formula that considers your basic salary, the number of overtime hours worked, and the applicable overtime rate.
For regular overtime, the formula is: Basic salary × 12/365/8 × total overtime hours × 1.25 = total overtime pay
For emergency overtime, which includes hours worked between 10 pm and 4 am or on rest days, the formula is adjusted to: Basic salary × 12/365/8 × total overtime hours × 1.5 = total overtime pay
This higher rate reflects the increased compensation for work during off-hours or emergencies. Keep in mind that overtime is capped at two hours per day, or less than 144 hours over a three-week period unless the work is necessary to prevent significant loss or accidents.
Public Holidays and Rest Days Calculation
Work performed on public holidays or rest days (weekends) entitles employees to either a substitute day off or 150% of their basic wage. This means the employee earns their regular pay plus an additional 50%. If work is done between 10 pm and 4 am during these times, the employee is entitled to an additional 50% night-time increase.
Shift Workers Overtime Calculations and Rules
Shift workers in the UAE have a distinct set of rules for overtime. The standard 50% increase for night-time work (between 10 pm and 4 am) does not apply to them. However, they are still entitled to overtime pay if they work beyond their scheduled hours. For additional hours worked, shift workers are entitled to their basic wage plus at least a 25% increase.
Employers can require shift workers to work up to two hours of overtime daily, but any extra hours must be compensated according to the relevant overtime rates. Shift workers are also subject to the overall cap of 144 overtime hours over a three-week period.
Ramadan Working Hours Adjustments
During Ramadan, UAE labour laws require employers to reduce the standard working hours by two hours each day for both Muslim and non-Muslim employees. For private sector employees, this means a reduction from 8 to 6 hours per day, without a reduction in salary. Any additional hours worked beyond the reduced hours are considered overtime and must be compensated accordingly, with at least a 25% increase for daytime hours and 50% for night-time hours (between 10 pm and 4 am).
These rules apply regardless of an employee’s fasting status.
Common Mistakes in Overtime Calculation to Avoid
Employers can make several common mistakes when calculating overtime, such as:
- Misapplying overtime rates, especially for public holidays or night shifts.
- Misclassifying exempt employees like senior managers or shift workers.
- Allowing employees to work beyond the legal limit of 144 hours in three weeks.
- Failing to accurately track and document overtime hours.
- Incorrectly applying the same overtime rules to shift workers, who often have different structures.
These mistakes can lead to legal disputes and penalties.
Overtime Pay for UAE Free Zones
Overtime regulations for employees working in UAE free zones can differ from those under federal labour laws. Each free zone operates under its own labour laws and regulations, which are governed by the respective free zone authority. Overtime pay rules, including rates and eligibility, are typically outlined in individual employment contracts or set by the free zone authorities.
In general, free zone employees should refer to their employment contracts or consult the relevant free zone authority for details regarding their overtime entitlements, including rates, limits, and working hour exemptions.
It’s important to note that while federal law mandates specific overtime rules, free zones often have customised policies tailored to the unique needs of businesses operating within those zones. If disputes or uncertainties arise, employees can consult with their free zone authority or seek guidance through the Ministry of Human Resources and Emiratisation (MoHRE), though jurisdiction may vary.
Employee Rights and Complaint Procedures
Dispute Resolution Over Overtime Pay
If you find yourself in a dispute regarding overtime compensation, you can seek assistance from the Ministry of Human Resources and Emiratisation (MoHRE). To start the process, file a complaint via the MoHRE Website, the MoHRE Smart App, or visit a Tawjeeh Centre. Once the complaint is submitted, MoHRE will attempt to mediate and resolve the matter within 14 working days. If the dispute is not resolved amicably, the case is escalated to the courts.
For disputes where the claim does not exceed AED 50,000 (USD 13,615), MoHRE’s decision is enforceable as if it were a court judgment. For claims exceeding this amount, MoHRE’s role is to facilitate mediation before the courts take over. They aim to resolve issues amicably and prevent individual labour disputes from escalating into collective unrest. Maintaining detailed records of your overtime hours is critical, as MoHRE will need this information to assess the case. To read more about this, visit the UAE Government Portal on resolving labour disputes.
How to File a Complaint:
1. Submit a Complaint:
Use one of the following MoHRE channels to file your complaint:
- MoHRE Website
- MoHRE Smart App (available for iOS and Android)
- You can also visit one of their Tawjeeh Centres if you prefer in-person assistance.
When submitting your complaint, you’ll need your personal information (passport number, ID card, etc.) and your employer’s establishment or license number.
2. Verification:
After submitting your complaint, MoHRE will send an OTP (one-time password) via text or email to verify your identity. This applies unless you’re using the mobile app.
3. Complaint Review and Resolution:
MoHRE will then review your complaint. They will contact both you and your employer to resolve the dispute amicably. If no resolution is reached within 14 working days, the case will be escalated to the judicial system, where a court will make a final decision.
4. Documentation:
Make sure you have clear records of the overtime hours worked and any relevant evidence to support your claim. These details will be crucial in helping MoHRE review and resolve the issue.
5. Track Your Complaint:
You can track the status of your complaint via the MOHRE Inquiry Services or through the MoHRE Smart App.
6. Contact Details:
For further inquiries, you can call MoHRE’s Labour Claims and Advisory Centre at 600590000, which operates from 8 AM to 8 PM. Alternatively, you can contact them through their WhatsApp service at the same number.
Please note that according to Article 54 of Federal Decree-Law No. 33 of 2021, employees have up to two years from the termination of employment to file any claims related to overtime pay or other labour rights. Additionally, as per Article 55, employees are exempt from paying judicial fees for claims not exceeding AED 100,000, ensuring that smaller claims can be pursued without financial barriers.
For more information, visit the MoHRE website or call their toll-free number at 80060.
How to Properly Document Overtime in the UAE
Properly documenting your overtime is essential for ensuring you receive the compensation you’re entitled to and for safeguarding your rights in the event of a dispute. Here are the steps to follow:
- Record Overtime Hours Accurately:
Keep a detailed log of all overtime hours worked, including the dates, start and end times, and the total hours beyond your regular schedule. This should include both planned and emergency overtime. Ensure that these records align with your employment contract and are updated regularly. - Align with Employment Contract:
Verify that your recorded overtime hours adhere to the terms stated in your contract. Your contract should specify the number of allowable overtime hours, the applicable rates (25% or 50% increases), and any limits on when and how overtime can be worked. - Break Times:
According to UAE labour law, workers must receive a break of at least one hour after five consecutive hours of work. Ensure that your break times are clearly documented and are not counted toward your total overtime hours. - Maintain Supporting Documents:
Collect and keep copies of relevant documents such as payslips, timesheets, and any written communication regarding overtime work. These documents will serve as evidence in case of any disputes with your employer.
Mastering Overtime Compensation
Understanding the UAE’s Labour Law regarding overtime is vital for employees navigating their rights and employers seeking compliance. As you track your working hours and advocate for your fair compensation, remember that clear record-keeping and knowledge of the various labour laws are your best tools. Whether your overtime is planned or arises from unexpected emergencies, the regulations are designed to ensure you receive the additional pay you’re entitled to.
If any issues arise, remember that MoHRE will guide you through the resolution process. For every professional in the UAE, staying informed and prepared can turn calculating overtime into a well-compensated aspect of your work life without the unwanted overtime stresses. Keep this guide handy and approach overtime calculation with confidence.
FAQ’s
Who is Entitled to Overtime Pay in the UAE?
Private sector employees working beyond 8 hours per day or 48 hours per week are generally entitled to overtime pay unless they hold exempt positions such as senior managers, supervisors, or workers engaged in marine or naval services.
Is Overtime Calculated Based on Basic or Gross Salary?
In accordance with UAE Labour Law, overtime is calculated using the employee’s basic salary. This excludes any additional allowances, benefits, or bonuses that form part of the gross salary.
How is Overtime Calculated for Public Holidays?
Employees working on public holidays are entitled to either a substitute day off or 150% of their basic salary.
What is the Maximum Allowable Overtime?
Overtime is capped at two hours per day and cannot exceed 144 hours over a three-week period.
Do Shift Workers Receive Night-Time Overtime Pay?
No, shift workers are exempt from the 50% increase for night-time work between 10 pm and 4 am, but they still receive a minimum 25% increase for overtime hours.
What Should I Do if I Have a Dispute Over Overtime Pay?
You can file a complaint with MoHRE, which will attempt to resolve the dispute within 14 days. If unresolved, the matter can be referred to the courts.
Can Employers Ask Employees to Work Overtime Without Prior Notice?
Employers can request employees to work overtime; however, it should typically be planned in advance. Emergency overtime, such as that required for unforeseen circumstances, is permitted but should not exceed the limits set by UAE labour law (two hours per day and 144 hours in a three-week period).
What Happens if Employees Refuse to Work Overtime?
In most cases, employees are expected to comply with reasonable overtime requests, provided the employer follows the legal requirements, such as paying appropriate compensation. However, if the overtime requested exceeds legal limits or breaches contract terms, employees may have the right to refuse.
How is Overtime Paid During Ramadan?
During Ramadan, the standard working hours are reduced by two hours each day. Any hours worked beyond this reduced schedule are considered overtime and must be compensated accordingly. The same overtime rates apply—25% for daytime hours and 50% for night-time hours (between 10 pm and 4 am).
Are There Any Exemptions to the Maximum Overtime Limits?
Yes, some categories of employees may be exempt from the maximum overtime limits. These include senior managerial roles, certain employees in supervisory positions, and workers in industries such as marine or naval services. Additionally, if an emergency threatens significant loss or danger, the daily cap on overtime can be exceeded.
