x Abu Dhabi, UAEMonday 21 August 2017

Rules in place for companies that fail to pay wages to be sanctioned

Companies delaying staff payments are restricted from additional work permits starting from the 16th day of the delay.

A year ago, a decree from the Ministry of Human Resources and Emiratisation was brought in to support workers struggling to obtain their wages.

All businesses employing more than 100 staff were subject to the rule, whereby companies delaying staff payments are restricted from additional work permits starting from the 16th day of the delay.

Delays for non-payment of wages for 60 days are subject to company fines of Dh5,000 if one worker is not paid and up to Dh50,000 if it affects multiple workers.

Companies with less than 100 staff can also face a ban on new work permits and fines, under the rules.

Workers owed money by their employer are advised to immediately take their complaints to the ministry, said Dubai lawyer Rashid Tahlak.

“Once a complaint has been made at the office of labour relations, either a settlement will be reached or the case will be referred to court for a resolution,” he said.

“If the employer or company has ceased trading or left the country, and litigation proceedings have concluded and a judgement been made, company assets can be searched, with bank accounts seized and assets sold to pay workers what they are owed if the company has limited liability.

“The business owner’s assets and bank account can also be liquidated and sold to cover the money owed to workers, as the financial liability of the institution and the owners are considered as one.

“If the manager of the company has been acting fraudulently, in this case the responsibility of the company manager shall be met in its own financing for the company’s obligations, according to the text of article number 84 of companies law.”