UAE is a very interesting destination for foreigners, especially professionals or any person looking for work. But there is doubt among many of them about what the minimum wage in UAE is. Likewise, this is a very important issue for employers in this country since they must be in tune with their labor laws to avoid incurring legal violations and subsequent sanctions.
In this article, you will learn everything about what the minimum wage in UAE is. On the other hand, we will also address the issue of basic salary, average salaries, and average salaries per location, such as in the emirate of Dubai, if there a minimum wage for expats in UAE, among other topics related to the minimum wage in UAE.
Minimum wage in UAE
First of all, we must define what the minimum wage is in general. The minimum wage is the minimum remuneration that a worker must receive by law for the provision of his services. The vast majority of countries have a legal minimum wage. For its part, a few countries leave this to a negotiation between the employer and the employee in a negotiation.
An important question for foreign employees who want to work in UAE is to know what their minimum wage is. Obviously, depending on the level of qualification that each job requires, it will have a higher or lower salary.
Now, in many countries around the world, their respective labor laws establish a minimum wage amount. Therefore, in these countries where labor legislation establishes in advance the amount of the minimum wage, employment contracts should not establish lower amounts. If they do so, employers will be subject to receiving legal sanctions according to the labor legislation of each country.
In any case, to avoid confusion between the parties that make up the employment relationship, the salary conditions must be clearly stated in the respective employment contract. Therefore, the salary of an employee in UAE is an agreement between the employer and the employee.
In the case of UAE, it is important to highlight that there is no minimum wage figure. Likewise, do not confuse the minimum wage in UAE with the basic salary since they are different figures.
In case of disputes over salary, the parties must go to the Ministry of Labor to find the best solution.
Basic salary notions in the United Arab Emirates
The basic salary in UAE is simply the amount agreed between employer and employee in the employment contract. For its part, this basic salary does not include extra bonuses, benefits, expenses, and any other extra-salary concept. In this sense, the basic salary in UAE lies in the amount that the employer pays to the employee for the provision of their labor services.
On the other hand, it is important to highlight that the UAE labor law establishes that this salary must be specified in the employment contract.
However, generally, employees in addition to their basic salary receive other employee benefits, such as:
- Corporate phone.
- Housing,
- Transportation
- Allowance
- And more.
In this order of ideas, the union of the base salary plus extra-salary concepts is equal to the gross salary. Likewise, these extra-salary labor concepts must be established in the employment contract.
Now, we must also talk about the net salary, which is equal to the gross salary minus legal deductions.
Ultimately, it is important to know that there is no minimum wage in UAE. The salary must be an agreement between the parties that make up the employment relationship. Now, having this information, in the interest of making a summary, it must be said that there are three types of salaries in the UAE:
The basic salary
This is the compensation agreement between the employer and the employee, which must be established in the employment contract. This type of salary is given after negotiation between the employer and the employee, who reach an agreement.
Normally, the employer will propose an amount as a basic salary to the employee, and the employee will accept or reject it, although they can also renegotiate the employee’s initial proposal to establish a higher amount.
Gross salary
Which is equal to the basic salary plus other types of labor compensation. Therefore, the gross salary in UAE is the total salary before any deductions or withholdings. Also, the gross salary in UAE includes the basic salary, as well as any bonuses, subsidies, commissions, or other benefits.
It is important to note that gross pay does not necessarily reflect net pay or the salary an employee receives after deductions such as taxes, social security contributions, and other expenses. For its part, deductions and withholdings may vary depending on the employee’s personal situation and the country’s tax regulations.
Net salary
This salary is equal to the gross salary minus legal deductions. Unlike gross salary, net salary is the salary that an employee receives after deducting withholdings and mandatory contributions, such as taxes, social security contributions, and other expenses.
On the other hand, in the UAE the tax system varies depending on the emirate. Most of the emirates do not levy personal income taxes. However, there are some exceptions, such as Dubai which has an income tax for certain sectors and commercial activities.
In addition to taxes, employees in the UAE may also have mandatory deductions and contributions, such as contributions to social security and pension plans.
Is there a mandatory minimum wage in the United Arab Emirates?
As we have already mentioned, there is no mandatory minimum wage in UAE. Consequently, the employer and employee must agree on salary concepts. Also, there is a belief that in the emirate of Dubai, that there is a mandatory minimum wage. The truth is that the UAE labor legislation does not have any provision on this matter.
In many countries around the world, there are minimum salaries by law, a situation that does not exist in UAE. This may seem like a disadvantage for employees, but the government of this country takes the working conditions of the people who work in its territory very seriously.
In this sense, the UAE Labor Law establishes that the salary or economic compensation that the employee receives for the provision of his or her labor services must cover his or her basic needs.
Average salaries in the UAE per profession
It is true that there is no mandatory minimum wage in the UAE, but this does not mean that wages cannot be averaged accordingly. An example of this is the average of the wages for domestic workers in UAE, whose average salary ranges between 1,100 and 1,800 AED, which is equivalent to approximately 300 to 500 US dollars.
The usefulness of taking these averages is that the potential worker already knows in advance what he or she may receive as a salary and thus avoids abuses by the employer. Likewise, these averages are not mandatory and the employee can accept a lower amount as salary.
Now, in general terms, these are some of the salary averages, depending on the level of the job:
- Employees at the university level normally receive no less than 12,000 AED per month or approximately 3,250 US dollars.
- The average salary of skilled workers is about 5,000 AED per month, which is equivalent to about 1,350 US dollars.
- Qualified technical-level employees usually earn at least 7,000 AED per month, which is equivalent to about 1,900 US dollars.
Now, being more specific with the professions, below we present an average monthly salary according to the profession in UAE:
- Babysitters: 1,100 AED or about 300 US dollars.
- Waiters: 1,200 AED or about 325 US dollars.
- Secretaries: 4,000 AED which is equivalent to approximately 1,100 US dollars.
- Nurses: AED 6,000. About 1,650 US dollars.
- Sales executives: Sales executives normally earn about AED 8,000, which is equivalent to about 2,200 US dollars.
- Computer engineer: 11,000 AED or about 3,000 US dollars per month.
- Human Resources Manager: 18,000 AED, about 4,900 US dollars.
- General Manager: 35,000 AED which is equivalent to approximately 9,500 US dollars.
Salary averages in the United Arab Emirates by job location
If a person has in mind to work in UAE, he must consider which place is best for them. The United Arab Emirates has a prosperous economy overall, but Dubai tops the list in this regard, so the average minimum wage is usually higher than in other emirates.
Obviously, everyone will want to work in Dubai, but we must remember that this is synonymous with greater competition and therefore greater difficulty in getting the job that a person wants.
In this sense, below we present an average of the monthly minimum wage in various places in the UAE:
- Dubai: 21,500 AED equivalents to about 5,850 US dollars.
- Abu Dhabi: The average salary in the capital is about 21,000 AED which is equivalent to about 5,700 US dollars.
- Ajman: 19,300 AED or about 5,250 US dollars.
- Fujairah: 18,100 AED which is equivalent to about 4,950 US dollars.
The geographical location of the job is a very important point to take into account since, for example, someone who works as a graphic designer in Dubai will earn 10% more compared to if he or she does the same job under the same conditions but in Fujairah.
Therefore, Dubai is the emirate with the best average salary in UAE and Fujairah is the one with the lowest. The difference is considerable since for any job in general, on average, the difference in salary between an employee working in Dubai and an employee working in Fujairah is more than 15%.
How does the UAE Labor Law regulate the minimum wage?
The UAE Labor Law is the most important law on labor matters in the United Arab Emirates. Regarding the minimum wage, this law opens the possibility that at any time a minimum wage can be established.
In general terms, this law does not establish anything about a mandatory minimum wage in the country, but it does establish some general guidelines on the basic salary and deductions for employees.
As the Labor Law leaves the door open so that a minimum wage can be established at any time in the UAE, employers must be aware of possible modifications in this matter so as not to incur a violation of the labor law.
On the other hand, taking into account the aforementioned salary averages according to the profession and location and since the Labor Law does not establish anything in this regard about the minimum wage in UAE, on this basis both employers and employees can have a starting point for salary negotiations.
Likewise, the UAE Labor law establishes that employees’ salaries must be sufficient to cover their basic needs. Although fortunately in UAE employers usually grant many extra-salary benefits to their employees. Therefore, they can make better use of their salaries since job benefits cover many of their basic needs.
Why choose NG Manpower as your best option in the United Arab Emirates?
UAE has the particularity that, unlike many countries in the world, it does not establish a mandatory minimum salary for employees working in the country. Therefore, the remuneration of an employee working in this country is a decision between the employer and the employee. For this, they have to take into account factors such as the qualification of the job, the specific profession, and the location of the job, among others.
Given all this information, NG Manpower can advise you on this and other UAE labor law issues so that you do not incur violations of the law. We have highly trained professionals with many years of experience, who will be able to advise you on this matter.
Likewise, we are the best manpower supply company for different companies in UAE, especially manpower supply in Dubai. We offer an attractive service especially for construction companies.
Therefore, if you want to obtain information about NG Manpower you can get in touch with us now!
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