UAE Labour Law: Key Amendments to Labour Dispute Resolution

Introduction:

The UAE has recently witnessed significant changes in its approach to resolving individual labour disputes, evident in the amendments made to Article 54 of the Federal Labour Law No. (33) of 2021 through Federal Decree-Law No. 20/2023.

This revision aims to modernize the dispute resolution process, bolster the role of the Ministry, and enhance the overall efficacy and fairness in settling conflicts between employers and workers.

The amended Article 54 introduces several key developments to the dispute resolution mechanism:Designated Ministry for Dispute Resolution:

The amended Article 54 retains the initial step where parties involved, whether an employer or worker, must submit a dispute resolution request to the UAE Ministry of Human Resources and Emiratisation (MoHRE). However, the Ministry now holds enhanced decision-making authority.

Ministry’s Decision Authority:

A key amendment grants the MoHRE increased decision authority to issue a final decision if the value of the claim subject to the dispute does not exceed AED 50,000. Additionally, if a party fails to comply with a prior amicable settlement decision, the Ministry can mediate and make a necessary decision, irrespective of the claim’s value.

Enforceability of Ministry’s Decision:

The MoHRE’s decision now carries the weight of a writ of execution, providing a stronger legal basis for enforcement. Dissatisfied parties retain the right to challenge the decision by filing a lawsuit before the competent Court of Appeal within 15 working days, ensuring a transparent and accountable process.

Referral to Competent Court:

If an amicable settlement proves challenging within the specified timeframe or in cases beyond the Ministry’s jurisdiction, the Ministry may refer the dispute to the competent court. This referral includes a memorandum summarizing the dispute, arguments of both parties and the Ministry’s recommendation, promoting a comprehensive understanding of the case.

Salary Disbursement During Dispute:

The amended Article acknowledges the Ministry’s authority to instruct the employer to continue paying the worker’s salary for up to two months if the dispute leads to a suspension of salary disbursement. This provision is subject to the Implementing Regulation, ensuring financial stability for the worker during the resolution process.

Prevention of Collective Labour Disputes:

The amended article introduces provisions for the Ministry to impose additional administrative procedures or measures on an establishment, aiming to prevent the escalation of individual disputes into collective labour disputes that could harm the public interest.

Urgent Court Proceedings:

The competent court is now mandated to set a hearing within three working days, ensuring an immediate resolution to the dispute. This aligns with the primary goal of prompt dispute resolution.

Procedural Compliance and Time Limit for Lawsuits:

The amended article underlines the importance of following to procedures for the competent court to entertain a lawsuit. Additionally, it establishes a time limit, specifying that a lawsuit related to rights outlined in the Decree-Law must be initiated within one year from the date of entitlement.

Conclusion:

The amendment of Federal Decree-Law No. (33) of 2021, Article 54 aims for a fair and efficient labour dispute resolution framework. It addresses the Ministry with increased decision-making authority, ensuring financial protection for workers, and introduces measures to prevent the escalation of disputes.

Dr. Hassan Elhais is a legal consultant in Dubai, specializing in the drafting of all statements of claim, memos and consultation on litigation of all manner.