Can Companies Delay Salary Payments Due to Vendor Obligations?

Under the UAE Salary Delay Law, employers are required to pay salaries on the agreed date, irrespective of whether they have received payments from clients or vendors. Numerous employees in Dubai and throughout the UAE encounter delayed salaries, often excused by “pending payments.” However, according to UAE labor law, such delays are unlawful and can lead to severe penalties for employers.

Legal Obligation to Pay Salaries on Time

As per Article 22 of the Federal Decree Law No. 33 of 2021 on the Regulation of Employment Relations, every employer in the UAE has a legal responsibility to pay employee wages on the due date specified in the employment contract. This obligation is reinforced by Ministerial Resolution No. (598) of 2022, which elaborates on the requirements of the Wages Protection System (WPS).

The regulation explicitly states:

“The employer shall pay the salaries or wages to its employees on their due dates in accordance with the regulations approved by the Ministry.”

This indicates that an employer cannot condition salary payments on when the company receives funds from its customers or external vendors. Salaries must be processed independently of any cash flow challenges faced by the business.

When Is a Salary Considered Delayed?

The UAE salary delay law categorizes a salary as “delayed” if it is not paid within 15 days from the due date specified in the employment contract. This stipulation is outlined in Article 1 (2) of Ministerial Resolution No. (598) of 2022, which states:

“Employers who fail to pay wages to their employees within 15 days of the due date will be considered late, unless the employment contract provides otherwise.”

Consequently, even if a company cites pending vendor payments, employees have the legal right to anticipate their salaries within this timeframe.

Consequences for Employers Who Delay Salaries

If an employer breaches the UAE salary payment law, various actions may be initiated by the Ministry of Human Resources and Emiratisation (MOHRE). According to Article 2 of the same resolution, penalties could include:

• Suspension of new work permits
• Financial fines and administrative sanctions
• Referral for legal action
• Potential blacklisting of the company in severe cases

These measures are designed to ensure that companies prioritize employee welfare and adhere to national labor laws.

What Employees Can Do About Delayed Salaries

If your salary is delayed beyond 15 days, you have the right to report the situation. The recommended steps are:

1. Discuss internally first: Attempt to resolve the matter directly with your HR or management.
2. File a complaint with MOHRE: If the delay continues, contact the Ministry of Human Resources and Emiratisation through their official website, app, or helpline (80060).
3. Submit supporting documents: Include your employment contract, salary slips, and communication records as evidence.

Once you file a complaint, MOHRE investigates and can compel the employer to release pending payments or impose penalties.

Why the UAE Salary Delay Law Protects Employees

The UAE government’s Wages Protection System was established to encourage transparency and guarantee timely wage disbursement across all sectors. The system monitors salary transfers through authorized financial channels, facilitating the detection of any delays or violations by authorities.

By enforcing these laws, the UAE ensures fair labor practices, enhances employee trust, and maintains the country’s standing as a globally respected employment hub.

Conclusion

In summary, under the UAE Salary Delay Law, employers are prohibited from delaying salary payments based on external vendor or client payments. Any salary delayed beyond 15 days from the due date is considered a violation. Employees are fully protected under UAE labor law and can seek assistance from MOHRE to address such issues legally and effectively.