A new Wage Protection System has been introduced through Ministerial Resolution No. 340 of 2026. This updated framework helps to strengthen wage compliance and monitoring. It supplements the Federal Decree-Law No. 33 of 2021 Regulating Labour Relations. The objective of this Resolution is enhancing worker protection against delayed payment of wages, increasing payroll transparency, and improving regulatory enforcement.

Wage Due Date and Payment Mechanisms

  1. Unified Wage Due Date – The official wage due date for salaries relating to the previous month will be the first day of every Gregorian month. If the wages are paid after this date, it is automatically treated as delayed.
  2. Mandatory Payment Through WPS – Employers registered with the Ministry must pay wages through the Wage Protection System or through any alternative payment systems approved by the Ministry.
  3. Obligation to Submit Proof of Payment – The employer must maintain and submit records of wage payments.

Regulatory Thresholds for Compliance

  1. Compliance Threshold – An establishment is treated as compliant if it transfers at least 85% of total wages due by the due date.
  2. Worker Threshold – A worker is not treated as unpaid if they receive at least 85% of their entitled wage.

Actions for Delayed Wage Payment

  1. Issuance of warnings, notifications, and payment alerts to non-compliant establishments
  2. Suspension of issuance of new work permits.
  3. Imposition of administrative fines under applicable Cabinet Resolution .
  4. Automatic registration of individual or collective labour disputes for affected workers.
  5. Suspension of work permit services for non-compliant establishments.
  6. Application of executive instruments for recovery of unpaid wages (especially for smaller establishments).
  7. Initiation of collective labour dispute procedures for larger establishments.
  8. Precautionary attachment of the establishment’s assets.
  9. Imposition of travel bans on responsible persons of the establishment.
  10. Referral to the Public Prosecution and competent authorities in serious or repeated violations.
  11. Escalation of enforcement where large numbers of workers are affected or there is risk to labour market stability.

Exemptions from WPS

The following are exempted from the WPS compliance:

A. Workers with Legal or Employment Status Issues – Workers with wage disputes before courts, absconding workers, workers under detention, and workers on unpaid leave.
B. Sector-Specific Exemptions – Certain sectors like seafarers, fishing boats, public taxis owned by citizens, and foreign companies paying employees abroad.
C. Institutional Exemptions – Institutions like banks, financial institutions, and places of worship, which may already have a separate financial or regulatory system.

Delegation of Wage Payment

Employers may appoint third parties to process wage payments and manage payroll operations. The employer remains legally responsible for the timely wage payment even if the operations are delegated.

Conclusion

The Ministerial Resolution No. 340 of 2026 significantly strengthens the Wage Protection System by introducing clearer timelines, measurable compliance thresholds, and a graduated enforcement mechanism for delayed wage payments. While it allows certain exemptions and operational flexibility through delegation, it maintains employer accountability and reinforces strict consequences for non-compliance, thereby enhancing overall wage protection and labour market regulation in the UAE.