Employee Compensation & Benefits in the UAE


United Arab Emirates has clear laws on employee rights, compensation and benefits. These are to be provided to the employee and the employer is held accountable for it.

In this article, we discuss some mandatory benefits in UAE. We also go over commonly offered benefits in the country.

What are the benefits given to employees in UAE?

The company extends some of the compulsory benefits to full-time employees. There is a huge distinction in temporary workers, freelancers and full-time employees. The laws for benefits are applied accordingly. Temporary workers or freelancers do not have the access to the same benefits as full time workers. Different benefits are entitled to employees working in different jurisdictions.

Mandatory Benefits in the UAE

Mandatory Benefits in the UAE

Employee benefits in UAE mandated by the government encompass leaves, gratuity, insurance, overtime, severance pay and social security.

Leave Allowances

One of the employee benefits in UAE is the entitlement to paid vacations and annual leaves according to labor law. Workers have the right to receive thirty days of paid vacations every year when they complete three years at their workplace.

Apart from these paid vacation, employee benefits in UAE also include official public holidays that are fourteen in number. These consist of New Year’s Day, Eid ul Fitr, Eid Ul Adha, Arafat Day, Islamic New Year and National Day among others.

Types of Leave in UAE

There are different kinds of leaves an employee can avail. Employee benefits in UAE include sick leave for employees having worked at a company for a particular duration of time. They are eligible for ninety days of leave every year. They have the option to take these at once or on different occasions in a year. The employee will receive full pay for their first fifteen days of absence when it is a sick leave. The next thirty days of leave will make for half the pay. The subsequent forty-five days will remain unpaid. Qualifying for a medical leave will require getting a medical certificate.

Maternity leave is for female employees. Its compensation depends on the duration the employee has worked at a company. If the worker has worked there for at least a year, the company pays full compensation in maternity leave benefits for forty-five days to the women. There will be compensation in form of fifty percent of pay for a forty-five days leave if the employee has been there for less than a year. If there are medical complications in birth or pregnancy, the employee can avail a hundred days of unpaid leave.

United Arab Emirates has recently introduced parental leave in the private sector too. Workers can get five days of parental leave until their child turns six months old.

End of Service Gratuity

Citizens of the UAE entitled to monthly pension payments by participating in the federal employment scheme. This does not extend to expats. They do not receive pension. They receive gratuity instead. It is also known as end of service payment. For their gratuity in UAE calculation to start paying out, their retirement age requirement is to be of sixty years of age.

Health Insurance

Dubai and Abu Dhabi require employers to have insurance plans for their employees. An insurance plan for employees and their dependents is required by Abu Dhabi Health Insurance Law. In Dubai, employers need to provide insurance adhering to Dubai Health Authority.

Social Security (for UAE Nationals and GCC Citizens)

Employee benefits in UAE include employers making social security contributions for their workers. Employers in Abu Dhabi calculate a percentage of the worker’s gross monthly salary at fifteen percent, while in the rest of the UAE (excluding Abu Dhabi), the percentage is twelve and a half percent.

What are allowances in UAE labor law?

Allowances are incentives and count as employee benefits in UAE. These are not required to be offered to employees. There are no legal obligations for employers to provide allowances to workers. Some employers offer these allowances to attract and retain talented individuals.

Commonly Offered Benefits

Some employee benefits in UAE are more common than the rest even though they are not a requirement. These consist of allowances for housing and transport, reimbursements for medical needs and flexible work arrangements.

Housing Allowance or Accommodation

Companies sometimes provide accommodation or allowance for house as part of their company policy of employee benefits in UAE. This might be allowance in form of cash. Or it could be a residential accommodation provided by the company.

Flight Reimbursement

Employees required to travel for work usually have their cost of flights, hotel stay, and travel reimbursed. This is one of the employee benefits in UAE.

Education Allowances

Some businesses offer allowances to encourage their employees to continue their education. This results in an upskilled workforce. Education allowances make it to the list of employee benefits in UAE too.

Transportation Allowances

Many companies in UAE reimburse workers for fuel prices or provide them with transportation allowances as part of their employee benefits. This assists in attracting and retaining talent.

Bonuses and Profit Sharing

Some companies have a policy of profit sharing if the employees meet a certain set of conditions. Bonuses are lucrative employee benefits in UAE. Offered to employees as recognition of their hard work, bonuses are a great addition to the list of employee benefits in UAE.

Flexible Working Arrangements

Some businesses offer flexible work arrangements as part of their package. This could mean hybrid setups, remote meetings or flexible timings. These soft employee benefits in UAE depend on the demands of that industry, company policy and the work required of employees.

What is the salary policy in UAE?

Your UAE salary check should reflect your qualifications, experience, and align with your job title according to MOHRE codes. Understand the breakdown to ensure fair compensation!


The UAE government and employers offer various employee benefits to workers. Some of these benefits are mandated by the government, while others are voluntarily provided. It is important to be careful of the legal obligations and being compliant with the UAE laws. Get in touch with us for our staffing solutions UAE.

Kinza HR is a leading recruitment consultant in Dubai helping companies hire workers while staying compliant with the laws of the land. We offer our services as Dubai staffing agency for staffing solutions UAE and employer of record UAE.


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